Post-Closing Adjustment. (a) Within ninety (90) days following the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations. (b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller. (c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account. (d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 2 contracts
Sources: Transaction Support Agreement (UpHealth, Inc.), Membership Interest Purchase Agreement (UpHealth, Inc.)
Post-Closing Adjustment. (a) Within No more than three (3) Business Days prior to the Closing Date and no more than two (2) Business Days after the Closing Date, an employee of Seller and one or more representatives or employees of Buyer shall calculate the quantity of sulfur, rock, ammonia and finished goods included in the Inventory located at the Facilities based upon a physical examination thereof. As soon as practicable (but in no event more than five (5) Business Days) following such physical examination, such employee of Seller and a representative or employee of Buyer shall summarize such Inventory calculations on a report (the “Inventory Report”) and deliver the Inventory Report to Buyer and Seller. The Inventory Report shall be executed and delivered by each of Buyer and Seller to the other party, and the quantity of such Inventory set forth thereon, absent manifest error, shall be final and binding on Buyer and Seller for purposes of calculating Net Working Capital on the Closing Date under this Section 3.5. The value of the Inventory set forth on the Inventory Report shall be determined in accordance with the accounting methods, practices, policies, procedures and estimation methods used to prepare the Balance Sheet.
(b) As soon as reasonably practicable, but in no event later than ninety (90) days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver cause to be delivered to Seller a statement certificate of the Chief Financial Officer of Buyer certifying (i) its good faith calculation of the Purchase Price, setting forth, in reasonable detail, a good faith calculation of each of the adjustments set forth in Section 3.2 (the “Closing StatementFinal Purchase Price”) setting forth its and (ii) a balance sheet for the Business as of immediately prior to the Closing prepared on a basis consistent with the accounting methods, practices, policies, procedures and estimation methods used to prepare the Balance Sheet and including all of the entries contained in Schedule 3.4(a) (the “Final Balance Sheet”).
(i) If the Estimated Purchase Price is greater than the Final Purchase Price, the Purchase Price shall be adjusted downward dollar-for-dollar and Seller shall pay to Buyer the amount of such reduction, and (ii) if the Estimated Purchase Price is less than the Final Purchase Price, the Purchase Price shall be adjusted upward dollar-for-dollar and Buyer shall pay to Seller the amount of such increase (each a “Post-Closing Adjustment Amount”). Any Post-Closing Adjustment Amount shall be paid by wire transfer of immediately available funds to an account designated by the party receiving payment within three (3) Business Days after the final determination of the amount of such reduction or increase in the Purchase Price in accordance with this Section 3.5.
(d) Upon receipt of the calculation of the Cash Consideration Final Purchase Price, Seller shall be permitted during the succeeding forty-five (45) day period (the “Review Period”) reasonable access, upon reasonable notice, to (i) the Books and each Records in the possession of and used by Buyer in the preparation of the components thereofFinal Balance Sheet and the calculation of the Final Purchase Price, including a reasonable level of supporting documentation used by Buyer in preparation of the Final Purchase Price, and (ii) the accounting personnel of Buyer supporting the Business and involved in the preparation of the Final Purchase Price and the Final Balance Sheet.
(e) If Seller disagrees with the Final Balance Sheet or the calculation of the Final Purchase Price, on or prior to the last day of the Review Period, Seller shall notify Buyer in writing of such disagreement with the Final Balance Sheet or the calculation of the Final Purchase Price, which notice shall set forth any such disagreement in reasonable detail, the specific item of the Final Balance Sheet or the calculation in the Final Purchase Price to which such disagreement relates and the specific basis for each such disagreement (the “Objection Notice”). The Closing Statement If Seller fails to deliver the Objection Notice within the Review Period, the Final Balance Sheet and Buyer’s calculation of the Final Purchase Price shall be prepared deemed to have been accepted by Seller and shall be final and binding and used in computing the Post-Closing Adjustment Amount. If Seller delivers the Objection Notice within the Review Period, subject to Section 3.5(f) below, Buyer and Seller shall negotiate in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principlesto resolve any such disagreement, and the books any resolution agreed to in writing by Buyer and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company Seller shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become be final and binding upon the parties hereto hereto.
(f) If Buyer and Seller are unable to resolve any disagreement as contemplated by Section 3.5(e) within 60 days after delivery of the Objection Notice, then Buyer and Seller shall submit the matter for resolution to a mutually agreeable independent international accounting firm (the “Independent Auditor”), who shall, acting as an arbitrator, resolve the dispute set forth in the Objection Notice. In the event Buyer and Seller are unable to agree on an Independent Auditor within thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to after the expiration of the thirty (30) such 60-day period, at the request of written notice to Buyer of its acceptance either party the Independent Auditor shall be appointed by the American Arbitration Association. The fees, costs and expenses of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) Independent Auditor shall specify in reasonable detail be borne equally by the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsparties.
(bg) If a timely The parties shall instruct the Independent Auditor to consider only those items and amounts which are identified in the Objection Notice of Disagreement is delivered by Selleras being items which Buyer and Seller are unable to resolve. Further, then the Closing Statement (as revised in accordance with this Section 1.5(b)) Independent Auditor’s determination shall be based solely on the relevant Books and Records and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved other written information provided by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter Independent Auditor shall notnot conduct additional discovery in any form.
(h) The parties shall jointly instruct the Independent Auditor to make a determination as soon as practicable within thirty (30) days (or such other time as the parties hereto shall agree in writing) after its engagement (i) whether or not the Final Balance Sheet was prepared, assign a value and the Final Purchase Price was calculated, in accordance with the terms of this Agreement or, alternatively, (ii) only with respect to any item in dispute greater than the greatest value for such item assigned by Buyerdisputed items submitted to the Independent Auditor, on to what extent (if any) the one hand, Final Balance Sheet or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other handFinal Purchase Price requires adjustment. The Closing Statement Independent Auditor shall provide the parties with a written explanation in reasonable detail of each such required adjustment, including the basis therefor. All negotiations pursuant to this Section 3.5 shall be treated as compromise and the resulting calculation settlement negotiations for purposes of Rule 408 of the Cash Consideration Federal Rules of Evidence and comparable state rules of evidence, and all negotiations and submissions to the Independent Auditor shall become be treated as confidential information. The Independent Auditor shall be bound by a mutually agreeable confidentiality agreement. The procedures of this Section 3.5 are exclusive and, except as set forth below, the determination of the Independent Auditor shall be final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealableparties. The fees and expenses of the Arbiter decision rendered pursuant to this Section 1.5(b3.5(h) may be entered as a judgment in any court of competent jurisdiction. Either party may seek specific enforcement or take other necessary legal action to enforce any decision under this Section 3.5(h). The other party’s only defense to such a request for specific enforcement or other legal action shall be borne fraud by the Company, on the one hand, and Seller, on the other hand, based or upon the percentage which Independent Auditor. Absent such fraud, such other party shall reimburse the aggregate portion of the contested amount not awarded party seeking enforcement for its expenses related to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerenforcement.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 2 contracts
Sources: Asset Purchase Agreement (CF Industries Holdings, Inc.), Asset Purchase Agreement (Mosaic Co)
Post-Closing Adjustment. (a) After the Closing Date, Seller and Buyer shall cooperate and provide each other access to their respective books, records and employees (and those of the Project Company) as are reasonably requested in connection with the matters addressed in this Section 2.6. Within ninety (90) 60 days following after the Closing Date, Buyer shallshall determine the Closing Date Net Working Capital and the Capital Expenditures Adjustment and shall provide Seller with written notice of such determination, or shall cause the Company to, prepare along with reasonable supporting information and deliver to Seller a statement calculations (the “Buyer’s Determination”).
(b) If Seller object to Buyer’s Determination, then it shall provide Buyer written notice thereof within 30 days after receiving Buyer’s Determination; provided, that Seller and Buyer shall be deemed to have agreed upon all items and amounts that are not disputed by Seller in such written notice. If the Parties are unable to agree on the Closing StatementDate Net Working Capital, within 120 days after the Closing Date, the Parties shall refer such dispute to a firm of nationally recognized independent public accountants mutually acceptable to Buyer and Seller (the “Independent Accountants”), which firm shall make a final and binding determination as to only those matters in dispute with respect to this Section 2.6(b) setting forth on a timely basis and promptly shall notify the Parties in writing of its calculation of the Cash Consideration and each of the components thereofresolution. The Closing Statement Independent Accountants shall be prepared in good faith in accordance with not have the terms power to modify or amend any term or provision of this Agreement, including, as applicable. Each Party shall bear and pay one-half of the fees and other costs charged by the Independent Accountants. If Seller does not object to Buyer’s Determination within the time period and in the manner set forth in the first sentence of this Section 2.6(b) or if Seller accept Buyer’s Determination, the Accounting Principles, Closing Date Net Working Capital and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following SellerCapital Expenditures Adjustment as set forth in Buyer’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration Determination shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and Parties for all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerpurposes hereunder.
(c) If the Cash Consideration Closing Date Net Working Capital and the Capital Expenditures Adjustment (as agreed between the Parties or as determined by the Independent Accountants or otherwise) (the “Final Adjustment”) is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as amounts related to such term is defined adjustments in the Senior Secured Notes Indenture) has not yet occurredAdjustment Estimate, then Buyer shall pay Seller, within five (5) 5 Business Days after the Closing Statement becomes final and binding in accordance with the terms hereofsuch amounts are agreed or determined pursuant to Section 2.6(b), the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making to an offer to repurchase account designated by Seller, the 2026 Notes difference between the Final Adjustment and the 2025 Notes amounts related to such adjustments in accordance with Section 1.8; provided, that the Adjustment Estimate and if the Fundamental Change Repurchase Date has occurred, Final Adjustment is less than the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up amounts related to an excess equal to the amount of such adjustments in the Adjustment Escrow Amount) Estimate, then Seller shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Considerationpay Buyer, within five (5) 5 Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (such amounts are agreed or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer determined pursuant to Section 1.5(c) (if any) 2.6(b), by wire transfer of immediately available funds for purposes of making to an offer to repurchase account designated by Buyer, the 2026 Notes difference between the Final Adjustment and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released amounts related to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth such adjustments in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesAdjustment Estimate.
Appears in 2 contracts
Sources: Purchase and Sale Agreement (CMS Energy Corp), Purchase and Sale Agreement (Consumers Energy Co)
Post-Closing Adjustment. (ai) Within ninety sixty (9060) days following the Closing Date, Buyer shall, or Seller shall cause the Company to, prepare and deliver to Seller Buyer a statement (the “Closing Statement”) setting that shall set forth its in reasonable detail Seller’s calculation of the Cash Consideration and each net amount of all adjustments to the components Base Purchase Price required by Section 2.6(a) taking into account actual data (the “Purchase Price Adjustment”), together with reasonable supporting material regarding the computation thereof. The Closing Statement Buyer shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the have thirty (30) days immediately following Seller’s receipt of to review the Closing StatementStatement following receipt thereof. On or before the end of such 30-day review period, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, Buyer may object to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and by written notice to Seller (the resulting “Objection Notice”), setting forth Buyer’s specific objections to the calculation of the Cash Consideration Purchase Price Adjustment. Such Objection Notice shall become final specify those items or amounts with which Buyer disagrees, together with a detailed written explanation of the reasons for disagreement with each such item or amount (and binding upon reasonable supporting material therefor), and shall set forth Buyer’s calculation of the parties hereto thirty (30) days following Purchase Price Adjustment based on such objections. To the extent not set forth in a timely-delivered Objection Notice, Buyer shall be deemed to have agreed with Seller’s receipt thereof unless Seller delivers written notice calculation of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that all other items and amounts contained in the Closing Statement and the resulting neither party may thereafter dispute any item or amount not set forth in such Objection Notice. If Buyer does not timely deliver any Objection Notice, Buyer shall be deemed to have agreed with and accepted Seller’s calculation of the Cash Consideration Purchase Price Adjustment, and the Closing Statement shall become be final and binding upon on the parties upon Parties as of the end of Buyer’s 30-day review period.
(ii) If Buyer timely delivers an Objection Notice to Seller’s delivery, prior to the expiration of Buyer and Seller shall, during the thirty (30) day periodperiod following such delivery (or any mutually agreed extension thereof), of written notice use their commercially reasonable efforts to Buyer of its acceptance negotiate and reach agreement on the disputed items and amounts in order to determine the amount of the Closing StatementPurchase Price Adjustment. Any Notice If, at the end of Disagreement delivered pursuant such period (or any mutually agreed extension thereof), the Parties are unable to resolve their disagreements, they shall jointly retain and refer their disagreements to a nationally recognized independent accounting firm selected by Seller (the “Independent Accountant”). The Parties shall instruct the Independent Accountant to promptly review this Section 1.5(a) shall specify 2.6 and to determine solely with respect to the disputed items and amounts so submitted whether and to what extent, if any, the Purchase Price Adjustment set forth in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration requires adjustment. The Independent Accountant shall become final and binding upon the parties base its determination solely on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved written submissions by Buyer and Seller are finally resolved Seller. As promptly as practicable, but in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the no event later than thirty (30) days immediately following after its retention, the delivery of a Notice of Disagreement or such longer period as Independent Accountant shall deliver to Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences a report which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 sets forth its resolution of the Federal Rules of Evidence disputed items and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer amounts and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination its calculation of the items included in Purchase Price Adjustment; provided that the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., Independent Accountant may not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned claimed by Buyer, on the one hand, or Seller, on the other hand, either Party or less than the smallest value for such item assigned claimed by Buyer, on the one hand, or Seller, on the other handeither Party. The Closing Statement and the resulting calculation decision of the Cash Consideration Independent Accountant shall become be final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealableParties. The fees costs and expenses of the Arbiter pursuant to this Section 1.5(b) Independent Accountant shall be borne by allocated between the Company, on the one hand, and Seller, on the other hand, Parties based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, each party bears to the aggregate amount actually contested by such party, as determined by the Independent Accountant. For exampleThe Parties agree to execute, if Seller claims requested by the Cash Consideration is $1,000 greater than the amount determined by BuyerIndependent Accountant, and ▇▇▇▇▇ contests only $500 of the amount claimed by Sellera reasonable engagement letter, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement including customary indemnities in favor of the Consenting Noteholders) for Independent Accountant. The Parties shall cooperate and shall furnish each other and, if applicable, the sole purpose Independent Accountant, with such documents and other records that may be reasonably requested in connection with the preparation, review and final determination of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer Purchase Price Adjustment and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, other matters addressed in each case, from the Adjustment Escrow Accountthis Section 2.6.
(diii) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for For purposes of making an offer to repurchase this Section 2.6(c), “Final Purchase Price Adjustment” means the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.Purchase Price Adjustment:
Appears in 2 contracts
Sources: Purchase and Sale Agreement (Public Service Co of New Hampshire), Purchase and Sale Agreement
Post-Closing Adjustment. (a) Within ninety (90) days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller (i) a statement balance sheet showing the Working Capital as of the Closing Date (the “Closing StatementDate Balance Sheet”), and (ii) a certificate setting forth its calculation of (a) the Cash Consideration Closing Date Working Capital (calculated in accordance with the Closing Date Balance Sheet) and each of (b) the components thereofamount by which the Estimated Closing Working Capital exceeds, or is exceeded by, the Closing Date Working Capital. The Closing Statement Date Balance Sheet shall be prepared in good faith a manner consistent with GAAP. The Closing Date Balance Sheet shall be prepared in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, Agreement by making appropriate adjustments to the books items specified in Schedule 1.1(109), while maintaining consistency with the principles and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify methodologies as were used in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationspreparing Schedule 1.1(109).
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final Buyer’s determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration Date Working Capital shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than Parties thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses after delivery of the Arbiter pursuant Closing Date Balance Sheet by Buyer unless Seller objects in good faith to this Section 1.5(b) shall be borne by Buyer’s preparation of the CompanyClosing Date Balance Sheet and calculation of the Closing Date Working Capital in writing, on stating in reasonable detail their objection thereto (the one hand“Notice of Disagreement”). Following delivery of the Notice of Disagreement, Seller and SellerBuyer agree to cooperate to exchange information used to prepare the Estimated Closing Working Capital, on Closing Date Working Capital and the other hand, based upon Notice of Disagreement. To the percentage which the aggregate extent any portion of the contested amount calculation of the Closing Date Working Capital is not awarded objected to in the Notice of Disagreement, such items portion shall be deemed to have been accepted by Seller. Seller and Buyer shall negotiate in good faith to resolve any objections noted in the Notice of Disagreement, but if they do not reach a final resolution within thirty (30) days after the delivery of the Notice of Disagreement, Seller and Seller, respectively, bears Buyer shall each submit such remaining disputes to the aggregate amount actually contested by Independent Accounting Firm in a revised Notice of Disagreement which details the remaining outstanding disputes. Seller and Buyer shall use their commercially reasonable efforts to cause the Independent Accountant to resolve all disputes as soon as practicable; provided, however, that the Independent Accountant shall be instructed to resolve all such party. For example, if Seller claims disputes within thirty (30) days after the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 submission of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 disputes to such Independent Accountant. The resolution of the $500 contesteddisputes by the Independent Accountant shall be final, then binding on, conclusive and non-appealable by the Parties. The costs and expenses of the Arbiter will Independent Accountant shall be allocated 60% (i.e., 300 ÷ 500) between Buyer and Seller in proportion to the Company relative difference between (a) the Closing Date Working Capital calculated by Seller, as adjusted for the resolution of any disputes between the Parties prior to the engagement of the Independent Accountant and 40% (i.e.b) the Closing Date Working Capital as finally determined by the Independent Accountant. The Independent Accountant will only consider those items and amounts set forth in the revised Notice of Disagreement submitted by either Party. The Independent Accountant shall make its determination based solely on presentations and supporting material provided by the Parties and not pursuant to any independent review, 200 ÷ 500) nor shall the Independent Accountant allow the Parties to Sellerconduct any discovery. In resolving any disagreement, the Independent Accountant may not assign any value to a disputed item greater than the greatest value claimed for such disputed item by any Party or lesser than lowest value claimed for such disputed item by any Party.
(c) If the Cash Consideration Estimated Closing Working Capital is greater than the Closing Date Working Capital which has become final and binding on the Parties pursuant to Section 2.6(b), Seller shall, within 5 days of the Closing Date Working Capital becoming final and binding, make payment by wire transfer to Buyer, in immediately available funds in the amount of such difference, together with interest thereon at a rate of 2% per annum from the Closing Date to the date of payment.
(d) If the Closing Date Working Capital which has become final and binding on the Parties pursuant to Section 2.6(b) is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurredClosing Working Capital, Buyer shall, within five (5) Business Days after 5 days of the Closing Statement becomes Date Working Capital becoming final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company tobinding, make a payment by wire transfer to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to Seller, in immediately available funds in the amount of such difference, together with interest thereon at a rate of 2% per annum from the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Closing Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount date of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Accountpayment.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 2 contracts
Sources: Merger Agreement (Dynegy Inc.), Purchase and Sale Agreement (NRG Energy, Inc.)
Post-Closing Adjustment. (a) Within ninety seventy-five (9075) days following the Closing Date, Buyer shallBuyer, or at its sole cost and expense, shall cause the Company to, in good faith prepare and deliver to Seller the Holder Representative a statement (the “Buyer’s Closing Statement”) setting forth its calculation Buyer’s good faith calculations of (a) Final Working Capital, (b) Final Company Transaction Expenses, (c) Final Indebtedness and (d) the Excluded Payroll Accounts as of the Cash Consideration Closing calculated in accordance with the Accounting Principles. The Holder Representative and each its independent certified public accountants shall have forty-five (45) days following receipt to review Buyer’s Closing Statement and make inquiry of the components thereofrepresentatives of Buyer’s accountants, subject to entry into customary non-disclosure and non-reliance agreements to the extent required by such accountants, and Buyer, who shall reasonably cooperate with the Holder Representative (including by providing the Holder Representative or its agents access to financial accounts and underlying source documents). The calculation regarding the foregoing items (a) through (d) contained in Buyer’s Closing Statement shall be prepared in good faith in accordance with the terms of this Agreementbinding and conclusive upon, including, as applicableand deemed irrevocably accepted by, the Accounting Principles, and Holder Representative unless the books and records of the Company and its Subsidiaries. During the thirty Holder Representative shall have delivered to Buyer a written notice (30a “Dispute Notice”) within forty-five (45) days immediately following Seller’s after receipt of the Buyer’s Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, Statement of any objections to the books and records of the Company for purposes of their review of the calculations set forth in Buyer’s Closing Statement. The Dispute Notice must set forth in reasonable detail the basis for any objections to Buyer’s Closing Statement and the resulting Holder Representative’s good faith calculation of the Cash Consideration shall become final and binding upon disputed amounts (such disputed amounts, the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of DisagreementDisputed Amounts”) to Buyer prior to such datein Buyer’s Closing Statement; provided that (i) such Disputed Amounts may only be based on mathematical errors or non-compliance with this Agreement (including the relevant definitions) and (ii) the Holder Representative shall be deemed to have agreed with all items and amounts included in the Buyer’s Closing Statement and except the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify Disputed Amounts specifically disputed in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsa Dispute Notice.
(b) If a timely Dispute Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised duly delivered pursuant to Section 2.8.2(a), the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ Holder Representative and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During Buyer shall, during the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writingdelivery, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in reach agreement on the Notice of Disagreement, and all Disputed Amounts. Any such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) agreement shall be governed in writing and shall be final and binding upon the Parties and the Sellers. If during such period, the Holder Representative and Purchaser are unable to reach such agreement, then all Disputed Amounts that cannot be resolved by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such them within thirty (30) day period (days after receipt of a Dispute Notice pursuant to this Section 2.8.2(a) shall be referred to Ernst & Young LLP or such longer period as another independent auditor mutually agreed by Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller Holder Representative (the “ArbiterDisputes Auditor”) for review decision, which decision shall be final and resolution. Buyer binding (it being agreed and Seller understood that the Disputes Auditor shall instruct the Arbiter to, and the Arbiter, acting act as an expert arbitrator to determine such disputed items or amounts and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) do so based solely on written submissions presentations and information provided by ▇▇▇▇▇ Buyer and Seller the Holder Representative and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an by independent review). Buyer In conducting its review, the Disputes Auditor shall consider only the Disputed Amounts and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest maximum value for such item assigned claimed by Buyer, on the one hand, or Seller, on the other hand, either party or less than the smallest minimum value for such item assigned claimed by Buyer, on the one hand, or Seller, on the other handeither party. The Closing Statement scope of the disputes, if any, to be resolved by the Disputes Auditor shall be limited to fixing mathematical errors and determining whether the items in dispute were determined in accordance with this Agreement (including the relevant definitions) and the resulting calculation of Disputes Auditor is not to make any other determination. The Parties agree that they will request that the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers Disputes Auditor render its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than decision within thirty (30) days following submission after referral of such disputed matters), the dispute to the Disputes Auditor for decision pursuant hereto. Each Party shall bear the fees and such final determination by disbursements of their respective representatives incurred in connection with their preparation or review of the Arbiter shall not be subject to court review or otherwise appealableDisputed Amounts. The fees fees, costs and expenses of the Arbiter pursuant to this Section 1.5(b) Disputes Auditor shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears the Holder Representative in proportion to the aggregate relative amount actually contested by each such party’s determination has been modified. For example, if Seller the Holder Representative challenges the calculation of Final Working Capital and claims that the Cash Consideration is Final Working Capital should increase by $1,000 greater than 100,000, but the amount determined Disputes Auditor determines that the Final Working Capital should increase only by Buyer$60,000, and ▇▇▇▇▇ contests only $500 the Holder Representative shall bear forty percent (40%) of the amount claimed by Sellerfees, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated Disputes Auditor and Buyer shall bear the other sixty percent (60% (i.e.%) of such fees and expenses. The date on which the Final Working Capital, 300 ÷ 500the Final Company Transaction Expenses and Final Indebtedness are finally determined in accordance with Section 2.8.2(a) and this Section 2.8.2(b) is hereinafter referred to as the Company and 40% (i.e., 200 ÷ 500) to Seller“Final Determination Date.”
(c) If the Cash Final Merger Consideration calculated in the same manner as the Initial Merger Consideration, but using Final Working Capital, Final Company Transaction Expenses, Final Indebtedness and Excluded Payroll Accounts, each as finally determined pursuant to Sections 2.8.2(a) and 2.8.2(b), exceeds the Initial Merger Consideration, then the Sellers shall be entitled to such excess (the “Excess Consideration”) in accordance with Section 2.8.2(d). If the Final Merger Consideration calculated in the same manner as the Initial Merger Consideration, but using Final Working Capital, Final Company Transaction Expenses, Final Indebtedness and Excluded Payroll Accounts, each as finally determined pursuant to Sections 2.8.2(a) and 2.8.2(b), is greater less than the Estimated Cash Initial Merger Consideration, then Buyer shall be entitled to such shortfall (the “Shortfall Consideration”) in accordance with Section 2.8.2(d). The Final Merger Consideration and adjustment required hereby is referred to as the Fundamental Change Repurchase Date “Adjustment.”
(as such term is defined d) If the Adjustment results in the Senior Secured Notes Indenture) has not yet occurredShortfall Consideration, then within five three (53) Business Days after the Closing Statement becomes final Final Determination Date, Buyer and binding in accordance with the terms hereof, Holder Representative shall instruct the Company shall, and Escrow Agent to pay to Buyer shall cause out of the Company to, make a payment to the Note Adjustment Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8Shortfall Consideration; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of funds then available in the Adjustment Escrow Amount) Account are less than the Shortfall Consideration, then the excess of the Shortfall Consideration over the funds then available in the Adjustment Escrow Account shall instead be paid from the Indemnity Escrow Account to Seller (and held in a deposit account subject to a control agreement in favor of Buyer; provided, further, that if the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect Indemnity Escrow Account is depleted, under no circumstances shall Buyer be entitled to any remaining 2025 Notesfurther recovery. If the Estimated Cash Consideration is greater than the Cash Adjustment results in Excess Consideration, then, within five three (53) Business Days after the Closing Statement becomes final Final Determination Date, subject to Section 2.6.2(a), Buyer will pay the Excess Consideration to the Payment Agent and binding the Surviving Corporation, in accordance with Section 2.6.2(k), for further payment to the terms hereofSellers pursuant to the final sentence of Section 2.6.1. If, after all payments pursuant to this Section 2.8.2(d) have been made, there are funds remaining in the Adjustment Escrow Account, Buyer and the Seller Holder Representative shall cause promptly instruct the Escrow Agent (including by delivering joint written instructions to release all such funds to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Payment Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes Surviving Corporation, in accordance with Section 1.8; provided2.6.2(k), for further payment to the Sellers pursuant to the final sentence of Section 2.6.1. Notwithstanding anything to the contrary herein, any amount payable under this Section 2.8.2(d) that if is taxable as compensation shall be paid to the Fundamental Change Repurchase Date has occurredSurviving Corporation for distribution in accordance with Section 2.6.2(d), and any amounts distributable pursuant to this Section 2.8.2(d) shall be reduced, in the remaining Adjustment Escrow Funds shall instead be released aggregate, by the employer portion of any applicable employment, payroll, social security, unemployment or similar Taxes (other than to Seller (and held the extent such Taxes have already been accounted for in the calculation of the Excluded Payroll Accounts, included as a Company Transaction Expense or otherwise resulted in a deposit account subject reduction in Final Merger Consideration pursuant to a control agreement in favor the terms of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesthis Agreement).
Appears in 2 contracts
Sources: Merger Agreement, Merger Agreement (Select Medical Corp)
Post-Closing Adjustment. (a) Within Not later than ninety (90) days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement an actual balance sheet of the Target Companies as of the close of business on the Closing Date (the “Closing Date Balance Sheet”), together with a detailed calculation, estimated in good faith and in accordance with GAAP, of the amount of the Net Working Capital Amount, the Indebtedness, the Transaction Expenses and Deferred Revenue Excess, respectively, as of 12:01 a.m. on the Closing Date (the “Preliminary Adjustment Statement”) setting forth its and, Buyer’s written calculation of the Cash Consideration Final Closing Purchase Price, and each of the components thereofadjustment necessary to reconcile the Estimated Purchase Price to the Aggregate Purchase Price (the “Preliminary Post-Closing Adjustment”). The Closing Statement Net Working Capital Amount shall be prepared in good faith calculated in accordance with methodologies used to calculate the terms sample working capital amount calculation set forth on Estimated Closing Balance Sheet, which is based on the Acquisition Balance Sheet; provided that notwithstanding anything to the contrary set forth on the Estimated Closing Balance Sheet or other provision of this Agreement, includingfor purposes of calculating the Net Working Capital Amount under this Section 2.4(b), any accounts receivables that were included in the Estimated Purchase Price at Closing but which had been outstanding for ninety (90) days or more as applicable, the Accounting Principles, and the books and records of the Company Closing Date and its Subsidiarieswhich have not been collected at such time that Buyer delivers the Closing Date Balance Sheet shall be disregarded and not included in connection with the adjustment to Aggregate Purchase Price contemplated by this Section 2.4(b). During the Seller shall have thirty (30) days immediately following Seller’s receipt after delivery of the Closing Statement, Preliminary Adjustment Statement (the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of DisagreementReview Period”) to notify Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “ArbiterDispute Notice”) for review and resolution. Buyer and that Seller shall instruct disputes the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the proposed Preliminary Post-Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by SellerAdjustment, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration no such notice is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as given within such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.time
Appears in 2 contracts
Sources: Membership Interest Purchase Agreement, Membership Interest Purchase Agreement (Harte Hanks Inc)
Post-Closing Adjustment. (ai) Within No later than ninety (90) days following the Closing Date, the Buyer shall, or shall cause the Company to, prepare in good faith and deliver to Seller the Seller’s Representative a statement (the “Closing Statement”) setting forth its an unaudited balance sheet of the Company as of the Effective Time and the Buyer’s calculation of (A) the Cash Consideration Banesco Line of Credit Amount, (B) Company Cash, (C) the Company Transaction Expenses, (D) the Closing Net Working Capital, (E) the amount, if any, by which the Target Net Working Capital exceeds the Closing Net Working Capital, and each (F) the proposed Final Promissory Note Amount calculated using the amounts set forth in the Closing Statement. The Seller Group shall use commercially reasonable efforts to cooperate with the Buyer and their accountants and other advisors in connection with the preparation of the components thereofClosing Statement. If the Buyer fails to deliver the Closing Statement to the Seller’s Representative within the ninety (90) day period specified in this Section 2.7(b)(i), then the Estimated Closing Statement and the Flow of Funds Memorandum shall be deemed the Closing Statement and the Seller’s Representative may exercise his rights pursuant to this Section 2.7. The parties agree that the purpose of preparing the Closing Statement and determining the Closing Net Working Capital, the Banesco Line of Credit Amount, Company Transaction Expenses, and Company Cash is to measure the amount of the Closing Net Working Capital, the Banesco Line of Credit Amount, Company Transaction Expenses, and Company Cash calculated in accordance with the Net Working Capital Calculation, and such processes are not intended to permit the introduction of different or new judgments, accounting methods, policies, principles, practices, procedures, classifications or estimation methodologies other than the Net Working Capital Calculation for the purpose of preparing the Closing Statement or determining the Closing Net Working Capital, the Banesco Line of Credit Amount, Company Transaction Expenses, and Company Cash. The Closing Statement shall be prepared not make purchase accounting adjustments arising out of the transactions contemplated by this Agreement and shall entirely disregard (I) any and all effects on the assets or liabilities of the Company as a result of the transactions contemplated by this Agreement or of any financing or refinancing arrangements entered into at any time by the Buyer or its Affiliates or any other transaction entered into by the Buyer or its Affiliates in good faith in accordance connection with the terms consummation of the transactions contemplated by this Agreement, includingand (II) any of the plans, as applicabletransactions, or changes which the Buyer intends to initiate or make or cause to be initiated or made after the Closing with respect to the Company or its business or assets, or any facts or circumstances that are unique or particular to the Buyer or its Affiliates or any of their assets or liabilities. For the avoidance of doubt, unless the Seller’s Representative otherwise agrees in writing, the Accounting PrinciplesBuyer may not amend, and adjust, supplement, or modify the books and records Closing Statement or any amounts set forth therein following their delivery to the Seller’s Representative.
(ii) The Seller’s Representative shall have a period of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s from the receipt of the Closing Statement (the “Review Period”) to review the Closing Statement. To the extent reasonably required to complete such review of the Closing Statement, for the Company shall duration of the Review Period and the pendency of any dispute, the Buyer will, upon written request, provide Seller the Seller’s Representative and its representatives his Representatives with reasonable access, access during normal business hours and after reasonable advance notice, to all working papers in the Buyer’s or its Representatives’ possession or control to the books and records of extent related to the Company for purposes of their review preparation of the Closing Statement. The Closing Statement and If, as a result of such review:
(A) the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers Representative agrees with the Closing Statement, the Seller’s Representative shall deliver to the Buyer a written notice of its agreement and the Closing Statement will be final, binding and non-appealable by the Seller Group;
(B) the Seller’s Representative disagrees with the Closing Statement, the Seller’s Representative shall deliver to the Buyer a written notice of disagreement (a “Notice of DisagreementDispute Notice”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty Review Period, setting forth the nature (30with reasonable supporting detail) day periodand amount of such disagreement and the Seller’s Representative’s determination thereof; provided, for the avoidance of written notice doubt, the Parties agree that the Buyer’s failure to Buyer of its acceptance of provide reasonable access required by Section 2.7(b)(ii) shall be deemed a sufficient basis for an objection by the Seller’s Representative.
(iii) If the Seller’s Representative does not deliver a Dispute Notice within the Review Period, then the Seller’s Representative will be deemed to have irrevocably accepted the Closing Statement. Any Notice of Disagreement Statement delivered by the Buyer pursuant to this Section 1.5(a) shall specify 2.7, in reasonable detail which case, the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified amounts set forth in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ final, binding, and Seller or any final resolution determined non-appealable by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerGroup.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 2 contracts
Sources: Membership Interest Purchase Agreement (XTI Aerospace, Inc.), Membership Interest Purchase Agreement (XTI Aerospace, Inc.)
Post-Closing Adjustment. (a) Within ninety 45 days after the Closing, IDT will deliver to UTCG (90) days following with a copy to Escrow Agent), a final statement setting forth certain agreed upon information concerning the Company’s business for the period from August 1, 2009 through the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement Date (the “Closing Final Statement”) setting forth its calculation as well as directions for the disbursement of funds, if any, to UTCG, from the escrow in accordance with previously agreed upon criteria (the “Adjustment Payment”) with the remainder to be disbursed to IDT. The Final Statement will be final and binding upon the parties for all purposes, unless UTCG notifies IDT, not later than fifteen (15) days after UTCG’s receipt of the Cash Consideration Final Statement, of a good faith disagreement with the Final Statement (the “Disagreement”). Such notice of Disagreement will specify all items as to which there is a Disagreement and an explanation of the basis for any Disagreement. UTCG’s failure to timely notify IDT in writing of the existence of such a Disagreement will be deemed as, for all purposes, UTCG’s acceptance of the Final Statement.
(b) UTCG and IDT will attempt, in good faith, to resolve any Disagreement. If the parties are unable to resolve any such Disagreement within thirty (30) days from the date of receipt by IDT of notice from UTCG of the Disagreement, either party may request, by delivering written notice to the other, that such Disagreement be resolved by an independent accounting firm jointly selected by the parties that has not provided material services to either party or their respective affiliates during the three (3) years immediately prior to its retention for such matter (the “Accountants”). If UTCG and IDT do not agree on the Accountants within ten (10) days after either requests that the Disagreement be submitted to the Accountants for resolution, then each of UTCG and IDT will nominate its selection to serve as the components thereofAccountants and those two nominated accountants will select a third accountant within ten (10) days, which third accountant will serve as the Accountants. The Closing If either party does not notify the other in writing of its selection to serve as the Accountants within ten (10) days after either requests that the Disagreement be submitted to the Accountants for resolution, then the accountants nominated by the other will serve as the Accountants. Each of UTCG and IDT will submit to the Accountants within ten (10) days after selection of the Accountants is completed its proposal concerning what the Final Statement shall should be prepared and all relevant financial data supporting its proposal. After completing their review of the Disagreement, the Accountants will resolve each item in good faith dispute in accordance with the terms of this Agreement, including, as applicable, Agreement and will confirm their conclusion in writing to the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the parties within thirty (30) days immediately following Seller’s receipt after the Accountants receive any proposals and supporting information timely submitted in accordance with this paragraph (b), and the decision of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become Accountants will be final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice for all purposes and enforceable in any court of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement competent jurisdiction, absent manifest error. The fees and the resulting calculation costs of the Cash Consideration shall become final Accountants, if any, in connection with resolving the Disagreement will be paid one-half by UTCG and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsone-half by IDT.
(bc) If a timely Notice of Disagreement is delivered by Seller, then Within five (5) days from the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier earliest to occur of (iA) the date any and all matters specified acceptance in writing, provided to the Notice Escrow Agent, of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and IDT of the determination set forth in the Final Statement, (iiB) the date any and all matters specified written notification of IDT to the Escrow Agent that UTCG did not provide notice to IDT of its Disagreement within the time period set forth in sub-section (a) above, or (iii) the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing delivery to the parties by the Arbiter Accountants of their written conclusion pursuant to sub-section (as defined below). The Closing Statement b) above, the Escrow Agent will disburse to UTCG the Adjustment Payment (which amount shall in no event exceed $500,000, or be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writingnegative number), Buyer and Seller shall submit any and all matters (but only such mattersi) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures written instructions provided pursuant to the Final Statement, or (ii) as determined pursuant to the procedure set forth in this Agreement sub-section (i.e.b) above, not on the basis of an independent review). Buyer and Seller shall cooperate in either case with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 remainder of the amount claimed held by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions being disbursed to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined IDT. The parties agree that in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause event the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are Litigation Payment is made to Buyer UTCG (pursuant to Section 1.5(c1.3(c) (if anyabove) by wire transfer prior to disbursement of immediately available funds for purposes of making an offer Adjustment Payment to repurchase the 2026 Notes and the 2025 Notes in accordance with UTCG under this Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred1.6, the remaining Adjustment Escrow Funds Payment, when and if due, shall instead be released to Seller reduced by one-half (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes1/2).
Appears in 2 contracts
Sources: Purchase Agreement (Idt Corp), Purchase Agreement (Idt Corp)
Post-Closing Adjustment. (a) Within ninety (90) As soon as practicable after the Closing, but no later than 90 days following after the Closing Date, Seller shall determine the actual adjustment to the Base Purchase Price pursuant to Section 2.02(b) and Section 2.02(c) as of the Closing Date. Seller and Buyer shallshall cooperate and provide each other access to their respective books and records (and those of the Companies) as are reasonably requested in connection with the matters addressed in this Section 2.06. Seller shall provide Buyer with written notice of such determinations within such 90 days, or shall cause the Company to, prepare and deliver to Seller a statement along with reasonable supporting information (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Post-Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of DisagreementEstimate”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations).
(b) If a timely Notice of Disagreement is delivered by Buyer objects to any determinations set forth in Seller’s Post-Closing Estimate, then it shall provide Seller written notice thereof within 20 Business Days after receiving Seller’s Post-Closing Estimate. If the Parties are unable to agree on the disputed amounts as of the Closing Statement (as revised in accordance with this Section 1.5(b)) and Date within 150 days after the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement Date or such longer period time as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise be agreed by ▇▇▇▇▇ and Seller) the Parties, the Parties shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of refer such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-an internationally recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (not the “Arbiter”) for review and resolution. principal accounting firm of either Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded acceptable to Buyer and Seller, respectively, bears which firm shall make a final and binding determination as to all such matters in dispute (and only such matters) on a timely basis and promptly shall notify the aggregate amount actually contested Parties in writing of its resolution. Such firm shall not have the power to modify or amend any term or provision of this Agreement. Each Party shall bear and pay one-half of the fees and other costs charged by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Selleraccounting firm.
(c) If the Cash Consideration Base Purchase Price adjusted using such actual values (as agreed or determined by the above-referenced accounting firm) (the “Final Purchase Price”) is greater than the Estimated Cash Consideration and Purchase Price, then Buyer shall, or shall cause one of the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurredCompanies to, pay Seller within five (5) 10 Business Days after the Closing Statement becomes final and binding in accordance with the terms hereofsuch actual values are agreed or determined, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase funds, the 2026 Notes difference between the Final Purchase Price and the 2025 Notes in accordance with Section 1.8; provided, that if Estimated Purchase Price plus interest thereon at the Fundamental Change Repurchase Interest Rate from the Closing Date has occurred, through and including the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount date of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notessuch payment. If the Estimated Cash Consideration Final Purchase Price is greater less than the Cash ConsiderationEstimated Purchase Price, then Seller shall pay Buyer within five (5) 10 Business Days after the Closing Statement becomes final and binding in accordance with the terms hereofsuch actual values are agreed or determined, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase funds, the 2026 Notes difference between the Estimated Purchase Price and the 2025 Notes in accordance with Section 1.8; provided, that if Final Purchase Price plus interest thereon at the Fundamental Change Repurchase Interest Rate from the Closing Date has occurredthrough and including the date of such payment. In each case, the remaining Adjustment Escrow Funds recipient Party shall instead designate the account to which such payment is to be released made at least two Business Days prior to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesdate such payment is due.
Appears in 2 contracts
Sources: Purchase and Sale Agreement (US Power Generating CO), Purchase and Sale Agreement (Reliant Energy Inc)
Post-Closing Adjustment. (ai) Within ninety (90) days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and Seller will deliver to Seller a statement (the “Closing Statement”) setting forth Buyer its good faith calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement Purchase Price and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s deliveryPurchase Price derived therefrom, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised each case calculated in accordance with this Section 1.5(b)) Agreement and the resulting calculation of the Cash Consideration shall become final Appendix A and binding upon the parties on the earlier of (i) the date any and all matters specified presented in the Notice of Disagreement are finally resolved in writing by same form and format as Appendix B (the “Post-Closing Adjustment Statement”). ▇▇▇▇▇ agrees that Seller shall have a reasonable right of consultation with Buyer in connection with ▇▇▇▇▇▇’s preparation of the Post-Closing Adjustment Statement and will provide Seller and its Representatives with access to its books, records, information, and employees as Seller may reasonably request. Buyer shall cause the personnel of Buyer and its subsidiaries (including the Acquired Company) to cooperate with Seller and its Representatives in connection with their preparation of the Post-Closing Adjustment Statement.
(ii) the date any and all matters specified The amounts determined by Seller as set forth in the Post-Closing Adjustment Statement will be final, binding, and conclusive for all purposes unless, and only to the extent, that within sixty (60) days after Seller has delivered the Post-Closing Adjustment Statement, Buyer delivers to Seller a written report containing any proposed changes to the Post-Closing Adjustment Statement, an explanation of any such changes, and the reasons therefor, accompanied by reasonably detailed documentation showing ▇▇▇▇▇’s calculation of the disputed amounts (an “Adjustment Dispute Notice”); provided, that the disagreement may be based for purposes of this Section 2.2(c) only on (i) mathematical errors, or (ii) amounts reflected in the Post-Closing Adjustment Statement not being calculated in accordance with this Agreement and Appendix A and the Accounting Principles. Any changes not included in the Adjustment Dispute Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised deemed irrevocably waived, and Seller’s determinations with respect to all such elements of the extent necessary to reflect any resolution agreed to by Post-Closing Adjustment Statement that are not addressed with specificity in the Adjustment Dispute Notice shall prevail and be deemed final and binding on the Parties. If ▇▇▇▇▇ fails to timely deliver an Adjustment Dispute Notice to Seller, the Post- Closing Adjustment Statement as delivered by Seller will be deemed to be mutually agreed upon by the Parties and will be final and binding on the Parties. If the Cash Purchase Price set forth in the Post-Closing Adjustment Statement is mutually agreed upon by Seller and Buyer, the Post-Closing Adjustment Statement and the Cash Purchase Price set forth therein shall be final and binding on the Parties.
(iii) If Buyer delivers an Adjustment Dispute Notice in compliance with Section 2.2(c)(ii) and Seller and Buyer are unable to reach a resolution with respect to all disputed items within 30 days of delivery of the Adjustment Dispute Notice (or such later date as may be mutually agreed in writing by Seller and Buyer), Seller and Buyer will submit any final items remaining in dispute for determination and resolution determined by to the Arbiter Independent Accounting Firm. The Independent Accounting Firm will be instructed to, and shall, determine, and resolve any such remaining disputed items in accordance with this Section 1.5Agreement and Appendix A and the Accounting Principles, as appropriate depending on the item at issue, and issue a final, written report to the Parties, within 30 days after such submission, of the Independent Accounting Firm’s final determination and resolution of the disputed items submitted to it. During In resolving any disputed items, the thirty Independent Accounting Firm: (30i) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt shall limit its review to resolve any differences which they may have with respect to any matter specified matters specifically set forth in the Adjustment Dispute Notice and in the case of Disagreement, all other items shall use the amounts which are agreed (or deemed agreed) upon by Seller and all such discussions related thereto Buyer; (unless otherwise agreed by ▇▇▇▇▇ and Sellerii) shall be governed by Rule 408 of the Federal Rules of Evidence limit its review to correcting mathematical errors and any applicable similar Law. At the end of determining whether such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which disputed items were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and determined in accordance with the guidelines and procedures set forth in this Agreement (i.e.and Appendix A and the Accounting Principles and shall not make any other determination, not including any determination as to whether any estimates on the basis of an independent review). Buyer Post-Closing Adjustment Statement are correct, adequate, or sufficient; and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter (iii) may not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value claimed for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned claimed by Buyereither Buyer or Seller in the Post-Closing Adjustment Statement or Adjustment Dispute Notice, respectively; provided, however, that to the extent the determination of the value of any disputed item affects any other item used in calculating the Final Cash Purchase Price, such effect may be taken into account by the Independent Accounting Firm. The report of the Independent Accounting Firm will be final, binding, and conclusive on the one handParties for all purposes, absent manifest error or Seller, on the other handFraud. The Closing Statement fees and the resulting calculation disbursements of the Cash Consideration shall become final Independent Accounting Firm will be allocated between Seller and binding on Buyer so that ▇▇▇▇▇’s share of such fees and disbursements will be in the parties hereto, if not already mutually agreed same proportion that the aggregate amount of any such remaining disputed items so submitted to the Independent Accounting Firm that is unsuccessfully disputed by ▇▇▇▇▇ and Seller, on (as finally determined by the date Independent Accounting Firm) bears to the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission total amount of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears amounts initially submitted to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerIndependent Accounting Firm.
(civ) If Within 10 Business Days following the final determination of the Cash Consideration Purchase Price pursuant to Section 2.2(c)(ii) or Section 2.2(c)(iii) (as so determined, the “Final Cash Purchase Price”), (i) if the Final Cash Purchase Price is greater than the Estimated Cash Consideration and Purchase Price, Buyer will pay the Fundamental Change Repurchase Date difference to Seller or (as such term ii) if the Final Cash Purchase Price is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds less than the Estimated Cash Consideration (up Purchase Price, Seller will pay the difference to an excess equal to the Buyer. Any amount of the Adjustment Escrow Amountpaid under this Section 2.2(c)(iv) shall be paid in cash by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount account specified by the Party receiving payment. Neither the determination of the Adjustment Escrow Amount) Final Cash Purchase Price nor any payment thereof shall instead be paid deemed to Seller (and held waive or limit in a deposit account subject to a control agreement any respect any representation, warranty, or rights in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Accountthereof under this Agreement.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 2 contracts
Sources: Securities Purchase Agreement (National Fuel Gas Co), Securities Purchase Agreement (Centerpoint Energy Resources Corp)
Post-Closing Adjustment. (a) Within ninety (90) 75 days following after the Closing Date, Buyer shall, or shall cause the Company to, Purchaser may prepare and deliver to Seller the Stockholder Representative a written statement (the “Post-Closing Statement”) setting forth its Parent’s calculation of (i) the Cash actual Net Working Capital as of the Closing, (ii) the estimated amount of all cash of the Company held in Company bank accounts as of the Closing, indicating the bank accounts in which such cash is (or was) held, (iii) the actual amount of all Transaction Costs of the Company, in the aggregate and itemized to show the amount paid or payable to each Person that is (or was) owed a portion of such Transaction Costs; (iv) the actual amount of all outstanding Debt of the Company as of the Closing, in the aggregate and with respect to each Person entitled to payment of a portion of such Debt (with reference to the Contract pursuant to which such Debt is owed) and (v) the Merger Consideration resulting from the foregoing. Unless within the 30-day period following Parent’s delivery of the Post-Closing Statement, the Stockholder Representative has tendered a written notice to Parent (the “Dispute Notice”) to the effect that the items contained in the Post-Closing Statement are erroneous or have not been prepared in accordance with this Section 1.9(a), setting forth in reasonable detail any such objection (each such item, an “Item of Dispute”), the Post-Closing Statement, including the Merger Consideration and each of the components thereofother items set forth therein, shall be conclusive and binding upon the Parent and the Stockholder Representative (on behalf of the Company Escrow Parties). The If Parent does not elect to prepare and deliver a Closing Adjustment Statement within 75 days after the Closing Date, then the Estimated Merger Consideration as set forth in the Estimated Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, final Merger Consideration and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final be conclusive and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement Parent and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsStockholder Representative.
(b) If the Stockholder Representative delivers a timely Dispute Notice to Parent within the 30-day period following Parent’s delivery of Disagreement the Post-Closing Statement, Parent and the Stockholder Representative shall use reasonable efforts (including the provision by Parent to the Stockholder Representative of such relevant information as the Stockholder Representative may reasonably request) to resolve their differences concerning the Items of Dispute, and if any Item of Dispute is delivered by Sellerso resolved, then the Post-Closing Statement shall be modified if necessary to reflect such resolution. If any Item of Dispute remains unresolved after 30 days from Parent’s receipt of the Dispute Notice, Parent and the Stockholder Representative shall jointly retain a mutually acceptable national or regional accounting firm with no formal relationship with either the Company or the Parent (the “Accounting Firm”) to resolve such remaining Items of Dispute. Parent and the Stockholder Representative shall request that the Accounting Firm render a determination as revised to each unresolved Item of Dispute (and as to no other matter) within 30 days of its retention, and Parent and the Stockholder Representative shall cooperate with the Accounting Firm so as to enable it to make such determination as quickly and as accurately as practicable. The Accounting Firm’s determination as to each Item of Dispute submitted to it shall be in writing, shall conform with this Section 1.9(b) and shall be conclusive and binding upon Parent and the Stockholder Representative (on behalf of the Company Escrow Parties). The Post-Closing Statement shall be modified if necessary to reflect such determination. The Accounting Firm shall allocate its costs and expenses to the Non-Prevailing Party or, if there is not a single Non-Prevailing Party, equally to Parent and the Stockholder Representative (on behalf of the Company Escrow Parties). For purposes of the preceding sentence, the “Non-Prevailing Party” is the party whose proposed calculation of all Items of Dispute submitted to the Accounting Firm, in the aggregate, was further from the calculation of the Items of Dispute determined by the Accounting Firm and differed from that calculation by more than 10% of the Items of Dispute, in the aggregate, as determined by the Accounting Firm.
(c) At such time as the Merger Consideration shall become final in accordance with this Section 1.5(b)) and 1.9, the resulting calculation of the Cash Estimated Merger Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised compared to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5Merger Consideration. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash final Merger Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date Merger Consideration, then within two (as such term is defined in the Senior Secured Notes Indenture2) has not yet occurred, within five (5) Business Days business days after the Closing Statement becomes determination of the final and binding in accordance with the terms hereofMerger Consideration, the Company shall, and Buyer Parent shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to be deposited the amount of the Adjustment difference with the Exchange Agent to be immediately distributed to the Company Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes Parties in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment each Company Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesParty’s Pro Rata Share. If the Estimated Cash final Merger Consideration is greater less than the Cash Estimated Merger Consideration, then within five two (52) Business Days business days after the Closing Statement becomes determination of the final Merger Consideration, the Stockholder Representative and binding in accordance with the terms hereof, Buyer and the Seller Parent shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) pay to make payment to Buyer (or its designees) of Parent an amount equal to such difference from the lesser of (i) an amount equal to Escrow Account. If there is a difference between the amount by which finally determined Merger Consideration and the Estimated Cash Merger Consideration exceeds then, within three (3) days of finalizing the Cash ConsiderationMerger Consideration pursuant to this Section 1.9, and (ii) the Adjustment Escrow FundsStockholder Representative shall, in each caseconsultation with Purchaser, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent Merger Consideration Spreadsheet to be updated as a result of such difference (including by delivering joint written instructions to substituting the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) final Merger Consideration for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesEstimated Merger Consideration as applicable).
Appears in 2 contracts
Sources: Agreement and Plan of Merger, Merger Agreement (Zillow Inc)
Post-Closing Adjustment. (a) Within ninety Following the Closing, Buyer shall cause ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ L.L.P. or such other "big five" accounting firm selected by Buyer and approved by Seller (90which approval shall not be unreasonably withheld) (the "Auditor") to prepare a valuation of Accounts Receivable and Inventory (the "Auditor Report"). The Auditor Report shall be prepared in accordance with the principles set forth on Exhibit C, and shall set forth the value of Accounts Receivable as of the Closing Date (the "Accounts Receivable Value") and the value of the Inventory as of the Closing Date (the "Inventory Value"), in each case in accordance with GAAP applied in accordance with Exhibit C. In addition, the Audit Report shall set forth the value of all deposits and prepayments made by Seller in respect of Assumed Contracts, which deposits and prepayments will inure to the benefit of Buyer and are identified on Schedule 1.05
(a) (the "Deposit/Prepayment Value"). For purposes of this Agreement and the Auditor Report, the aggregate Deposit/Prepayment Value shall not exceed $500,000. The Audit Report shall state the sum of the Accounts Receivable Value plus the Inventory Value plus the Deposit/Prepayment Value (the "Audited Value"). The Auditor shall deliver the Auditor Report to Buyer and Seller within thirty (30) business days of the Closing Date (the "Audit Report Date"). Buyer and Seller shall share equally the cost of the Auditor Report.
(b) If Seller disputes the Auditor Report, Seller shall so notify Buyer in writing (a "Notice of Dispute") within ten (10) days following after the Closing Datedate of Seller's receipt of the Auditor Report, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement (the “Closing Statement”) setting forth specifying its calculation of the Cash Consideration Accounts Receivable Value and each the Inventory Value and any other points of disagreement. Upon receipt of a Notice of Dispute, Buyer shall promptly consult with Seller with respect to such alternate calculation and points of disagreement in an effort to resolve such dispute (in connection with such effort to resolve disputes, and in connection with the Auditor's preparation of the components thereof. The Closing Statement Auditor Report, Buyer shall be prepared in good faith in accordance with the terms of this Agreementgrant to Seller, including, as applicable, the Accounting Principles, its agents and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with Auditors reasonable access, during normal business hours and after reasonable advance notice, access to the books and records of Buyer pertaining to the Company for purposes of their review of the Closing StatementInventory and Accounts Receivable). The Closing Statement If any such dispute cannot be resolved by Seller and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty Buyer within five (305) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to after Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of receives a Notice of Disagreement or such longer period Dispute from Seller, Seller and Buyer shall immediately appoint the Boston, Massachusetts office of Ernst & Young LLP to act as Buyer an arbitrator (the "Accounting Arbitrator") to determine the appropriate calculation of each of the Accounts Receivable Value, the Inventory Value, the Deposit/Prepayment Value, the Audited Value and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have all other remaining points of disagreement with respect to the Auditor Report (the "Review"). Seller and Buyer understand and agree that, in resolving any matter specified dispute with respect to the Auditor Report, the Accounting Arbitrator shall apply GAAP and the standards set forth on Exhibit C. All determinations made by the Accounting Arbitrator shall be final, conclusive and binding. The Accounting Arbitrator shall be directed to hold a hearing within ten (10) days of appointment (which hearing shall be held in the Notice of DisagreementBoston, Massachusetts) and all to make a determination within five (5) days after such discussions related thereto (hearing, unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealableparties. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) Accounting Arbitrator shall be borne equally by the Company, on the one hand, Seller and Seller, on the other hand, based upon the percentage which the aggregate portion by Buyer. Each of the contested amount not awarded to Buyer parties shall bear its own attorneys' and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs accounting fees and expenses of incurred in connection with the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerReview.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within Within five (5) Business Days after business days of the Closing Statement becomes final later of (x) the Audit Report Date and binding (y) in accordance with the terms hereofcase of any dispute of pursuant to Section 1.05(b), the Company shall, and Buyer shall cause resolution of such dispute:
(i) If the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration Audited Value exceeds the Estimated Cash Consideration $80,300,000 (up to an excess equal to the amount of such excess being the Adjustment Escrow Amount"Additional Purchase Price"), then
(A) Buyer shall pay Seller by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser Additional Purchase Price and (B) Buyer shall pay to Seller the Retention Amount by wire transfer of (i) an amount equal to immediately available funds. Under no circumstances shall the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and Additional Purchase Price exceed $25,000,000.
(ii) If the Audited Value is less than $80,300,000, then Buyer shall be entitled to the difference between $80,300,000 and the Audited Value (the "Downward Adjustment Escrow FundsAmount"); provided, in each casehowever, from that under no circumstances shall the Downward Adjustment Escrow Account.
Amount exceed $25,000,000. If the Downward Adjustment Amount exceeds the sum of the Retained Amount plus the Estimated Payment (dsuch excess being herein referred to as the "Required Additional Payment"), then (A) Within five (5) Business Days after first, the Closing Statement becomes final Retention Amount shall be credited to and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, retained by Buyer and Seller shall cause (B) the Escrow Agent (including by delivering joint written instructions shall pay to the Escrow Agent) to make a payment Buyer from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) existing Accounts Receivable/Inventory Holdback Amount by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8Required Additional Payment; provided, provided further that if the Fundamental Change Repurchase Date Downward Adjustment Amount exceeds $20,000,000, Seller shall pay to Buyer by wire transfer of immediately available funds such excess amount up to an amount not to exceed $5,000,000.
(iii) If a Downward Adjustment Amount has occurredbeen determined and no Estimated Payment was made pursuant to Section 1.04(e), then (A) first, the Retention Amount shall be reduced and credited to Buyer by an amount equal to the Downward Adjustment Amount, and (B) to the extent the Downward Adjustment Amount exceeds the Retention Amount (the "Excess Amount"), the Escrow Agent shall pay to Buyer from the Accounts Receivable/Inventory Holdback Amount by wire transfer of immediately available funds the Excess Amount; provided further that if the Downward Adjustment Amount exceeds $20,000,000, Seller shall pay to Buyer by wire transfer of immediately available funds such excess amount up to an amount not to exceed $5,000,000. Any Retention Amount remaining Adjustment Escrow Funds after the reduction thereto pursuant to subclause (A) above shall instead be released paid by Buyer to Seller by wire transfer of immediately available funds.
(iv) If the Downward Adjustment Amount is less than the sum of Retention Amount and held in a Estimated Payment (such shortfall being herein referred to as the "Required Refund"), then (A) if the Required Refund is less than or equal to the Estimated Payment then Buyer shall pay to the Escrow Agent for deposit account subject into the Accounts Receivable/Inventory Holdback Amount by wire transfer of immediately available funds an amount equal to a control agreement in favor the Required Refund or (B) if the Required Refund is greater than the Estimated Payment then Buyer shall (x) pay to the Escrow Agent for deposit into the Accounts Receivable/Inventory Holdback Amount by wire transfer of immediately available funds an amount equal to the Estimated Payment and (y) pay to Seller from the Retention Amount an amount equal to the excess of the Consenting NoteholdersRequired Refund over the Estimated Payment by wire transfer of immediately available funds. Notwithstanding anything to the contrary contained herein, Buyer agrees that under no circumstance shall Escrow Agent release any of the Escrow Amount to Buyer to satisfy any amounts owed to Buyer in respect of the Downward Adjustment Amount except as otherwise permitted pursuant to Section 9.04(b). Any payment by Seller, the Escrow Agent or Buyer required by this subsection (c) for shall bear interest at the sole purpose rate equal to the interest being earned on the Accounts Receivable/Inventory Holdback Amount pursuant to the Post Closing Escrow Agreement from the Closing Date until the date of complying with mandatory repurchase requirements set forth payment. The Additional Purchase Price or the Downward Adjustment Amount, as the case may be (excluding payments attributable to interest), will be treated by the parties as an increase or decrease, as the case may be, in the Senior Secured Notes Supplemental Indenture with respect Purchase Price.
(d) The allocation for tax purposes of the Purchase Price will be agreed upon by the parties prior to any remaining 2025 Notesthe Closing.
Appears in 2 contracts
Sources: Asset Purchase Agreement (Converse Inc), Asset Purchase Agreement (Converse Inc)
Post-Closing Adjustment. (a) Within ninety (90) 120 days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement (the “Closing Statement”) setting forth its calculation balance sheet of the Cash Consideration and each of the components thereof. The Closing Statement shall be Business prepared in good faith in accordance with GAAP and consistent with the terms policies and practices of this Agreement, including, as applicableSeller in the preparation of the Balance Sheets to the extent consistent with GAAP and a statement setting forth Buyer’s good faith calculations (“Buyer’s Proposed Calculations”) of the Closing Working Capital, the Accounting PrinciplesClosing Working Capital Adjustment, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to Purchase Price Adjustment based on such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsamounts.
(b) If a timely Seller does not object to the Buyer’s Proposed Calculations by written notice of objection (the “Notice of Disagreement is Objection”) delivered by to Buyer within 30 days after Seller’s receipt of Buyer’s Proposed Calculations, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration Closing Working Capital Adjustment and the Purchase Price Adjustment pursuant to Buyer’s Proposed Calculations shall become be deemed final and binding. A Notice of Objection under this Section 2.6(b) shall set forth in reasonable detail Seller’s alternative calculations of the Closing Working Capital, the Closing Working Capital Adjustment, and the Purchase Price Adjustment, in each case calculated based on such amounts.
(c) If Seller delivers a Notice of Objection to Buyer within the 30-day period referred to in Section 2.6(b), then any element of Buyer’s Proposed Calculations that is not in dispute on the date such Notice of Objection is given shall be treated as final and binding upon and any dispute (all such amounts, the parties on the earlier of “Disputed Amounts”) shall be resolved as set forth in this Section 2.6(c):
(i) Seller and Buyer shall promptly endeavor in good faith to resolve the date any and all matters specified Disputed Amounts listed in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) Objection. If a written agreement determining the date any and all matters specified in the Notice of Disagreement Disputed Amounts has not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period been reached within ten Business Days (or such longer period as may be agreed by Seller and Buyer) after the date of receipt by Buyer of the Notice of Objection, the resolution of such Disputed Amounts shall be submitted to PricewaterhouseCoopers LLP (the “Arbitrator”).
(ii) Seller and Seller Buyer shall use their commercially reasonable efforts to cause the Arbitrator to render a decision in accordance with this Section 2.6(c) along with a statement of reasons therefor within 30 days of the submission of the Disputed Amounts, or a reasonable time thereafter, to the Arbitrator. The decision of the Arbitrator shall be final and binding upon each party hereto and the decision of the Arbitrator shall constitute an arbitral award that is final, binding and non-appealable and upon which a judgment may agree in writing), Buyer and Seller be entered by a court having jurisdiction thereover.
(iii) The Purchase Price Adjustment shall submit any and all matters be calculated based on (but only such mattersA) which remain each element of Buyer’s Proposed Calculations that is not in dispute and which were properly included in (B) the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (Arbitrator with respect to the extent such amounts are in disputeDisputed Amounts, and the Purchase Price Adjustment, as so calculated, shall be deemed to be final and binding.
(iv) based solely on written submissions by ▇▇▇▇▇ and If Seller and Buyer submit any Disputed Amounts to the Arbitrator for resolution, Seller and Buyer shall each pay their own costs and expenses incurred under this Section 2.6(c). Seller shall be responsible for that fraction of the fees and costs of the Arbitrator where (x) the numerator is the absolute value of the difference between Seller’s position with respect to the Purchase Price Adjustment and the Purchase Price Adjustment as calculated based on the Arbitrator’s final determination with respect to the Disputed Amounts and (y) the denominator is the absolute value of the difference between Seller’s position with respect to the Purchase Price Adjustment and Buyer’s position with respect to the Purchase Price Adjustment, and Buyer shall be responsible for the remainder of such fees and costs.
(v) The Arbitrator shall act as an arbitrator to determine, based on the provisions of this Section 2.6(c), only the Disputed Amounts and the determination of each amount of the Disputed Amounts shall be made in accordance with the guidelines and procedures set forth in this Agreement Section 2.6(a). The Arbitrator shall base its determination solely on (i.e., A) the written submissions of the parties and shall not on the basis of conduct an independent review). Buyer investigation and Seller shall cooperate with (B) the Arbiter during extent (if any) to which the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, Closing Working Capital Adjustment and the Arbiter shall notPurchase Price Adjustment require adjustment (only with respect to the remaining disagreements submitted to the Arbitrator) in order to be determined in accordance with this Agreement, assign a value the Accounting Principles and Exhibit A and, with respect to any item in dispute greater than each Disputed Amount, the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties heretoArbitrator’s determination, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereofposition of either Buyer or Seller, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an not be in excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase higher, nor less than the 2026 Notes and the 2025 Notes in accordance with Section 1.8; providedlower, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held amounts presented in a deposit account subject to a control agreement in favor Buyer’s calculation of the Consenting NoteholdersPurchase Price Adjustment pursuant to Section 2.6(a) for the sole purpose of complying with mandatory repurchase requirements set forth or in the Senior Secured Notes Supplemental Indenture with respect Seller’s Notice of Objection pursuant to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow AccountSection 2.6(b).
(d) Within five (5) Business Days after The term “Final Purchase Price Adjustment” means the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Purchase Price Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer calculated pursuant to Section 1.5(c2.6(b) (or 2.6(c), as the case may be. The term “Final Purchase Price” means the Initial Purchase Price, plus the Final Purchase Price Adjustment, if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase such amount is a positive number, or minus the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor absolute value of the Consenting Noteholders) Final Purchase Price Adjustment, if such amount is a negative number. The Final Purchase Price Adjustment shall be treated as an adjustment to the purchase price for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesfederal, state, territory, local and foreign income Tax purposes, unless otherwise required by applicable Law.
Appears in 2 contracts
Sources: Purchase and Sale Agreement (Alphatec Holdings, Inc.), Purchase and Sale Agreement (Globus Medical Inc)
Post-Closing Adjustment. (a) Within ninety (90) calendar days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement consolidated balance sheet of the Target Companies as of 11:59 p.m. on the day immediately preceding the Closing Date, prepared in accordance with GAAP and on a basis consistent with the GAAP conventions used for the preparation of the Audited Financial Statements; provided that such balance sheet shall reflect the Transaction Costs accrued as of the Closing and shall include each of the items set forth in the definition of Closing Working Capital (whether or not otherwise required to be included on a balance sheet prepared in accordance with GAAP), but otherwise shall be calculated without giving effect to the consummation of the Contemplated Transactions and shall exclude any Indebtedness incurred under financing or refinancing arrangements entered into at any time by any of the Buyer Parties or any other transaction entered into by any of the Buyer Parties in connection with the Contemplated Transactions (including with respect to any of the Target Companies) (such balance sheet, the “Proposed Final Balance Sheet”). The Proposed Final Balance Sheet shall also include schedules setting forth the calculation of (i) Closing Working Capital as of 11:59 p.m. on the day immediately preceding the Closing Date as reflected in the Proposed Final Balance Sheet (the “Proposed Final Closing Working Capital”), (ii) Cash of the Target Companies as of 11:59 p.m. on the day immediately preceding the Closing Date as reflected in the Proposed Final Balance Sheet (the “Proposed Final Closing Cash”) and (iii) the Balance Sheet Indebtedness of the Target Companies as of 11:59 p.m. on the day immediately preceding the Closing Date as reflected in the Proposed Final Balance Sheet (the “Proposed Final Balance Sheet Indebtedness”). The Proposed Final Closing Balance Sheet, together with such schedules, is referred to herein as the “Proposed Final Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Seller will have forty-five (45) calendar days following delivery of the Proposed Final Closing Statement during which to notify Buyer in writing (the “Notice of Disagreement is delivered by Seller, then Objection”) of any objections to the Closing Statement (as revised in accordance with this Section 1.5(b)) and preparation of the resulting Proposed Final Balance Sheet or the calculation of the Cash Consideration shall become final Proposed Final Closing Working Capital, Proposed Final Closing Cash, and binding upon Proposed Final Balance Sheet Indebtedness, in each case, setting forth the parties on basis of its objections in such detail as will permit Buyer to understand such objections, and the earlier U.S. dollar amount of each objection. In reviewing the Proposed Final Closing Statement, Seller (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised entitled to the extent necessary reasonable access during normal business hours to reflect any resolution agreed to by ▇▇▇▇▇ all material personnel, accountants, books, records, contracts and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 documents of the Federal Rules of Evidence and any applicable similar Law. At Target Companies that are required by Seller to confirm the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination accuracy of the items included in the Proposed Final Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash ConsiderationStatement, and (ii) shall be furnished by the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final Target Companies such information and binding in accordance with the terms hereof data that Seller may reasonably request and if the Fundamental Change Repurchase Date (as such term that is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.readily
Appears in 2 contracts
Sources: Equity Interest Purchase Agreement, Equity Interest Purchase Agreement (NGL Energy Partners LP)
Post-Closing Adjustment. (a) Within ninety seventy-five (9075) days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller Representative a written statement (the “Closing Buyer Statement”) setting forth its forth, in reasonable detail and with reasonable supporting information, Buyer’s calculation of the Closing Cash Consideration Consideration, including the Buyer’s calculation of the Closing Adjustment Amount and each of the components thereof. The Closing Buyer shall prepare the Buyer Statement shall be prepared in good faith and in accordance a manner consistent with the terms of (including the definitions contained in) this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the .
(b) Seller Representative shall have thirty (30) days immediately following Seller’s receipt of from the Closing Statement, date on which the Company shall provide Buyer Statement is delivered to Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, Representative (the “Review Period”) to review the books and records of the Company for purposes of their review of the Closing Buyer Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Unless Seller Representative delivers written notice of its disagreement (a “Notice of Disagreement”) to the Buyer prior to such date; provided that 5:00 p.m. New York City time on the Closing Statement and the resulting calculation last day of the Cash Consideration shall become final Review Period that it objects to any item or items shown or reflected in the Buyer Statement, and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify specifying in reasonable detail the nature item or items to which it objects and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
reasons therefor (b) If a timely Notice of Disagreement is delivered by Sellersuch item or items, the “Disputed Items” and, such notice, the “Dispute Notice”), then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised deemed accepted by Sellers for all purposes of this Agreement. In the event that the Seller Representative delivers a Dispute Notice prior to 5:00 p.m. New York City time on the extent necessary last day of the Review Period, then Seller Representative and Buyer shall attempt in good faith to reflect resolve each Disputed Item, and any resolution agreed to by ▇▇▇▇▇ them in writing shall be final, binding and conclusive for all purposes of determining the payments in Section 2.4(c). In the event that, for any reason, Seller or any final resolution determined by the Arbiter Representative and Buyer are unable to resolve in accordance with this Section 1.5. During the thirty writing each Disputed Item within fifteen (3015) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Seller Representative and Buyer and Seller may agree in writing)) following the delivery of the Dispute Notice, Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice Parties will then retain the New York, New York office of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇▇▇▇ and Seller and in accordance with LLP (the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review“Independent Accountant”). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and each unresolved Disputed Item shall be referred to the Arbiter shall notIndependent Accountant. If any Disputed Item is referred to the Independent Accountant, assign a value to any item in dispute greater than the greatest value for such item assigned by each of Buyer, on the one hand, or Sellerand Seller Representative, on the other hand, or less than shall prepare separate written reports of each such Disputed Item and deliver such reports to the smallest value for Independent Accountant within twenty (20) days after the date the Independent Accountant is retained. Each of the Parties shall use their respective commercially reasonable efforts to cause the Independent Accountant, acting as an expert, as soon as practicable and in any event, barring exceptional circumstances, within thirty (30) days after receiving such item assigned written reports, to determine the manner in which the Disputed Items shall be treated in the Buyer Statement; provided, however, that the dollar amount of each Disputed Item shall be determined within the range of dollar amounts proposed by the Buyer, on the one hand, or Sellerand Seller Representative, on the other hand. The Closing Statement Parties acknowledge and agree that (i) the review by and determination of the Independent Accountant shall be limited only to the Disputed Items contained in the reports prepared and submitted to the Independent Accountant by the Parties and (ii) the determinations by the Independent Accountant shall be based solely on (1) such reports submitted by the Parties and the resulting calculation basis for their respective positions and (2) the terms of (including the definitions contained in) this Agreement. None of the Cash Consideration Parties shall become final and binding on authorize the parties hereto, if not already mutually Independent Accountant to modify or amend any term or provision of this Agreement or modify items previously agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to between the Parties. Each of Buyer and Seller Representative shall (which final determination A) enter into an engagement letter with the Independent Accountant containing customary terms and conditions for this type of engagement and (B) use their respective commercially reasonable efforts to cooperate with and provide information and documentation, including work papers, to assist the Independent Accountant. Any such information or documentation provided by Buyer or Seller Representative to the Independent Accountant shall be requested concurrently delivered to such other Party, subject, in the case of independent accountant work papers, to such other Party entering into a customary confidentiality and release agreement with respect thereto. Neither Party shall disclose to the Independent Accountant, and the Independent Accountant shall not consider for any purposes, any settlement discussions or settlement offers made by ▇▇▇▇▇ any of the Parties with respect to any Disputed Item. The determinations by the Independent Accountant as to the Disputed Items shall be in writing and Seller to shall be delivered not more than thirty (30) days following submission an expert determination that is final, binding and conclusive for all purposes of such disputed mattersdetermining the adjustments in Section 2.4(c), if any, and such final determination by the Arbiter shall not may be subject to entered and enforced in any court review or otherwise appealableof competent jurisdiction. The fees costs and expenses of the Arbiter pursuant to this Section 1.5(b) Independent Accountant shall be borne by the Companyallocated between Buyer, on the one hand, and SellerSellers, on the other hand, based upon on the percentage which the aggregate portion of all Disputed Items submitted to the contested amount Independent Accountant that are not awarded to Buyer and Seller, respectively, resolved in favor of Seller Representative bears to the aggregate amount actually contested by such partyof all Disputed Items submitted to the Independent Accountant. For As an illustrative example, if Seller claims Disputed Items asserting that the Closing Cash Consideration is should be increased by $1,000 greater than are submitted to the amount determined by BuyerIndependent Accountant, and ▇▇▇▇▇ contests only the Independent Accountant finally determines that the Closing Cash Consideration should be increased by $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested300, then the costs and expenses of the Arbiter will Independent Accountant shall be allocated 6070% (i.e., 300 ÷ 500$700/$1000) to the Company Seller Representative and 4030% (i.e., 200 ÷ 500$300/$1,000) to SellerBuyer.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 2 contracts
Sources: Asset Purchase Agreement (Digital Media Solutions, Inc.), Asset Purchase Agreement (Digital Media Solutions, Inc.)
Post-Closing Adjustment. 4.1 Calculation of the Actual Assets Amount
(a) Within ninety By no later than April 10, 2014, the Seller shall provide the final value amount (90book value in JPY under JAPAN-GAAP which the Seller complies with) days following and final quantities of the Closing DateAssets and reasonable supporting documents (other than cash) as of March 31, Buyer shall2014 (for WIP, or shall cause the Company toraw materials and spare parts, prepare and deliver to Seller a statement as of 8:30 AM (Japan Time); (the “Closing StatementActual Assets Amount”) setting forth its calculation of ), and shall notify the Cash Consideration and each of amount with the components reasonable supporting documents to the Purchaser in writing thereof. The Closing Statement Purchaser shall be prepared cooperate in good faith in accordance with order to enable the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and Seller to finalize its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationscalculation.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties Purchaser agrees on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing amount notified by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “ArbiterNotified Assets Amount”) for review and resolution. Buyer and ), or does not notify any proposal to modify the Notified Assets Amount to the Seller shall instruct within 10 business days from the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination receipt of the items included in notification from the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination the “Seller’s Notification”), the Notified Assets Amount shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerActual Assets Amount.
(c) If the Cash Consideration is greater than Purchaser has a proposal to modify the Notified Assets Amount, the Purchaser shall notify the proposal to the Seller in writing within 10 business days from the receipt of the Seller’s Notification, and shall have good faith discussions to determine the amount with the Seller. If the Parties do not agree on the amount within 30 calendar days from the receipt of the Seller’s Notification, a reputable accounting firm determined by the Parties shall review the Notified Assets Amount and determine the Actual Assets Amount. The costs and expenses to be paid to the accounting firm shall be equally borne by the Parties.
4.2 If the amount obtained by deducting the Estimated Cash Consideration and Assets Amount from the Fundamental Change Repurchase Date (as such term Actual Assets Amount is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereofa positive figure, the Company shall, and Buyer Purchaser shall cause the Company to, make a payment pay to the Note Escrow Account of Seller an amount equal to such difference as an increase in consideration for the amount by Transferred Business, within 30 calendar days from the date on which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes Actual Assets Amount is determined in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, 4.1 (b) or (c).
4.3 If the amount obtained by which the Cash Consideration exceeds deducting the Estimated Cash Consideration (up to an excess equal to Assets Amount from the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in Actual Assets Amount is a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Considerationnegative figure, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions pay to the Escrow Agent) to make payment to Buyer (or its designees) of Purchaser an amount equal to such difference as a reduction from the lesser of (i) an amount equal to consideration for the amount by Transferred Business, within 30 calendar days from the date on which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term Actual Assets Amount is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes determined in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller 4.1 (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholdersb) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesor (c).
Appears in 2 contracts
Sources: Business Transfer Agreement (Tower Semiconductor LTD), Business Transfer Agreement (Tower Semiconductor LTD)
Post-Closing Adjustment. (a) Within ninety (90) 1.6.2.1 No later than 45 days following the Closing Date, Buyer shall, or shall cause the Company to, GCI will prepare and deliver to Seller the Company a statement (the “Closing Date Statement”) setting forth its showing, in reasonable detail, a calculation of Shareholders’ Equity as of immediately prior to the Cash Consideration and each of Closing (the components thereof. The “Closing Statement shall be prepared Date Shareholders’ Equity”).
1.6.2.2 Within 45 days after the date GCI delivers to the Company the Closing Date Statement, if the Company disagrees in good faith with GCI’s calculation of Closing Date Shareholders’ Equity as set forth in accordance with the terms of this AgreementClosing Date Statement, including, as applicable, the Accounting Principles, and the books and records of then the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers may give BUS_RE\1394606.17 written notice of its disagreement (a the “Notice of DisagreementObjection Notice”) to Buyer prior to GCI within such date; provided that 45-day period (i) setting forth the Company’s determination of Closing Statement Date Shareholders’ Equity and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30ii) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify specifying in reasonable detail the nature Company’s basis for disagreement with GCI’s determination of Closing Date Shareholders’ Equity. The failure by the Company to deliver an Objection Notice within such 45-day period shall constitute the acceptance of GCI’s computation of Closing Date Shareholders’ Equity. If the Company and amount GCI are unable to resolve any matter raised in the Objection Notice with respect to the determination of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice Closing Date Shareholders’ Equity within 30 days after delivery of Disagreement is delivered by Sellerthe Objection Notice, then the Closing Statement (as revised items in dispute shall be submitted to binding arbitration in accordance with this Section 1.5(b)) and the resulting calculation 10.1. The final computation of Closing Date Shareholders’ Equity, determined by reference to either GCI’s computation of Closing Date Shareholders’ Equity, agreement of the Cash Consideration shall become final and parties or binding upon arbitration, as the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (case may be, is referred to herein as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “ArbiterFinal Shareholders’ Equity.”) for review and resolution. Buyer and Seller shall instruct
1.6.2.3 If, after the Arbiter toFinal Shareholders’ Equity has been determined, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater less than the Estimated Cash Consideration and Consideration, the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurredSellers shall promptly pay to GCI, within five (5) Business Days days after the Closing Statement becomes final and binding in accordance with the terms hereofFinal Shareholders’ Equity has been determined, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to such difference plus interest accruing on such amount at a rate of 8% per annum from the Closing Date until such amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) is paid, by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesdesignated by GCI. If the Estimated Cash Consideration is greater less than the Cash Consideration, GCI shall promptly pay to the Company, within five (5) Business Days days after the Closing Statement becomes final and binding in accordance with the terms hereofFinal Shareholders’ Equity has been determined, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser such difference plus interest accruing on such amount at a rate of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, 8% per annum from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as until such term amount is defined in the Senior Secured Notes Indenture) has not yet occurredpaid, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and account designated by the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesCompany.
Appears in 2 contracts
Sources: Stock Purchase Agreement (General Communication Inc), Stock Purchase Agreement (Gci Inc)
Post-Closing Adjustment. (a) Within ninety No sooner than three (903) months after the Closing Date, but no later than four (4) months after the Closing Date, Buyer shall deliver to Seller a statement (the “Post-Closing Statement”) setting forth in reasonable detail Buyer’s good faith calculation of (i) the Adjustment Amount, including each component thereof, and (ii) the resulting calculation of the Purchase Price. Concurrently with the delivery of the Post-Closing Statement, Buyer shall deliver to Seller reasonable documentation in the possession of Buyer or any of its Affiliates to support the items for which adjustments are proposed or made in the Post-Closing Statement delivered by Buyer, and a brief explanation of any such adjustments and the reasons therefor. In the event Buyer does not deliver the Post-Closing Statement in accordance with this Section 2.7, Seller’s pre-Closing estimate of the Purchase Price shall control and be the Final Purchase Price unless Seller elects to deliver a Post-Closing Statement within ten (10) Business Days after such four (4) month anniversary of the Closing Date, then the Parties shall proceed in accordance with Section 2.7(b) except that the rights of Seller and Buyer shall be reversed.
(b) Seller shall have thirty (30) days after Seller’s receipt of the Post-Closing Statement (the “Review Period”) within which to review Buyer’s calculation of the Purchase Price. If Seller disputes any component of the proposed Purchase Price set forth in the Post-Closing Statement delivered pursuant to Section 2.7(a) (the “PC Statement Purchase Price”), Seller shall notify Buyer in writing of its objection to the PC Statement Purchase Price prior to the expiration of the Review Period, together with a description of the basis for and dollar amount of such disputed components (to the extent possible), together with reasonable documentation in the possession of Seller supporting such disputed components (a “Dispute Notice”). The PC Statement Purchase Price shall become final, conclusive and binding on the Parties, and be considered the Final Purchase Price for all purposes of this Agreement, unless Seller delivers to Buyer a Dispute Notice prior to the expiration of the Review Period. If Seller timely delivers a Dispute Notice, (i) any amounts in the PC Statement Purchase Price not objected to by Seller in the Dispute Notice shall be final, conclusive and binding on the Parties, and (ii) Buyer and Seller shall, within fifteen (15) days following Buyer’s receipt of such Dispute Notice (the “Resolution Period”), use commercially reasonable efforts to attempt to mutually resolve in writing their differences with respect to any remaining items set forth in the Dispute Notice and any such mutual resolution shall be final, conclusive and binding on the Parties.
(c) If, at the conclusion of the Resolution Period, any items set forth in the Dispute Notice remain in dispute (the “Remaining Disputes”), then each of Buyer and Seller shall submit all such Remaining Disputes to PriceWaterhouse Coopers LLP (or such other nationally recognized accounting firm the Parties may mutually select), for resolution; provided that if PriceWaterhouse Coopers LLP has not confirmed that it will arbitrate such disputes and the Parties do not agree on another accounting firm within ten (10) days following the request from the Parties for PriceWaterhouse Coopers LLP to arbitrate such disputes, the Houston, Texas, office of the American Arbitration Association shall select a nationally recognized accounting firm not materially affiliated with Seller or Buyer to arbitrate such disputes. The appointed accounting firm shall be the “Accounting Firm”, and within five (5) Business Days after appointment of the Accounting Firm the Parties shall deliver to the Accounting Firm their written position with respect to such Remaining Disputes. The Accounting Firm, once appointed, shall have no ex parte communications with the Parties concerning the Remaining Disputes. The Accounting Firm shall determine, based solely on the submissions by Seller and Buyer, and not by independent review, only the Remaining Disputes and shall choose either Seller’s position or Buyer’s position with respect to each matter addressed in a Dispute Notice, in each case, in accordance with this Agreement. The Accounting Firm may not award damages, interest or penalties to any Party with respect to any matter. The Parties shall request that the Accounting Firm make a decision with respect to all Remaining Disputes within forty-five (45) days after the submission of the Remaining Disputes to the Accounting Firm, as provided above, and in any event as promptly as practicable. The final determination with respect to all Remaining Disputes shall be set forth in a written statement by the Accounting Firm delivered simultaneously to Seller and Buyer and shall, absent manifest error, be final, conclusive and binding on the Parties and enforceable against the Parties in any court of competent jurisdiction, without right of appeal. Buyer and Seller shall promptly execute any reasonable engagement letter requested by the Accounting Firm and shall each cooperate fully with the Accounting Firm, including, by providing the information, data and work papers used by each Party to prepare and/or calculate the Final Purchase Price, making its personnel and accountants available to explain any such information, data or work papers, so as to enable the Accounting Firm to make such determination as quickly and as accurately as practicable. The fees, costs and expenses of the Accounting Firm pursuant to this Section 2.7(b) shall be borne one half by Seller, on the one hand, and one half by Buyer, on the other hand.
(d) From and after the Closing DateDate until the Final Purchase Price is finally determined pursuant to this Section 2.7, Seller, its Affiliates and their auditors, accountants, counsel and other representatives shall be permitted reasonable access to the Company and its auditors, accountants, personnel, books and records and any other documents or information reasonably requested by Seller (including the information, data and work papers used by Buyer and/or the Company’s auditors or accountants to prepare and calculate the Final Purchase Price).
(e) If the final agreed Adjustment Amount exceeds the Adjustment Amount, as determined at Closing (such excess amount, if any, the “Excess Amount”), within five (5) Business Days after the Final Purchase Price is finally determined pursuant to this Section 2.7, Buyer shall, or shall cause the Company to, prepare and deliver pay to Seller a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall be prepared Seller, in good faith in accordance with the terms of this Agreementimmediately available funds, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, an aggregate amount equal to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsExcess Amount.
(bf) If a timely Notice of Disagreement the final agreed Adjustment Amount is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for Adjustment Amount, as determined at Closing (such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties heretoshortfall amount, if not already mutually agreed by ▇▇▇▇▇ and Sellerany, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters“Shortfall Amount”), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding Final Purchase Price is finally determined pursuant to this Section 2.7, Seller shall pay to Buyer, in accordance with the terms hereofimmediately available funds, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an aggregate amount equal to the amount Shortfall Amount, which funds shall be delivered in whole or in part by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes Seller and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) Agent to make payment release from the Deposit to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow AccountShortfall Amount.
(dg) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller Any payments made pursuant to this Section 2.7 shall cause the Escrow Agent (including by delivering joint written instructions be deemed an adjustment to the Escrow Agent) to make a payment from the Adjustment Escrow Account Purchase Price, to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) extent permitted by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesapplicable Law.
Appears in 2 contracts
Sources: Membership Interest Purchase Agreement (Civitas Resources, Inc.), Membership Interest Purchase Agreement (Civitas Resources, Inc.)
Post-Closing Adjustment. (ai) Within ninety The Merger Consideration paid at Closing has been determined based on the Company's estimate of the net book value of the consolidated assets and liabilities of Target1, Target 2, Target 3 and Target4 related to the retail stores listed on Schedule 6.13 as set forth on Schedule 4.3 hereto (90the "Opening Balance Sheet").
(ii) As soon as practicable after the Closing Date and in any event within sixty (60) days following thereafter, the Closing Date, Buyer shall, or Company shall cause Arth▇▇ ▇▇▇e▇▇▇▇ ▇▇▇, the Company toindependent public accountants of the Company, to prepare a post-closing report which shall set forth the actual net book value of the consolidated assets and deliver to Seller a statement liabilities of Target1, Target2, Target3 and Target4 contained in the Opening Balance Sheet, in substantially the same form as the Opening Balance Sheet (the “"Post-Closing Statement”) setting forth its calculation Report"); provided, however, that the net book value of goodwill shall be valued for all purposes under this Agreement at the Cash Consideration and each of value reflected in the components thereofOpening Balance Sheet. The Such Post-Closing Statement Report shall be prepared in good faith accordance with generally accepted accounting principles consistently applied by the Company ("GAAP") (for the purposes of this paragraph, said Post-Closing Report shall not be deemed to have been prepared in accordance with GAAP if an adjustment thereto otherwise indicated by GAAP is not made on the terms basis that the amounts involved are not material to the Post-Closing Report taken as a whole, unless any single such adjustment involves less than Two Thousand Five Hundred Dollars ($2,500) and all such adjustments in the aggregate involve less than Two Thousand Five Hundred Dollars ($2,500). Parent and its representatives may participate in the preparation of this Agreement, including, as applicable, the Accounting Principles, Post-Closing Report. The Post-Closing Report shall be submitted to each of Parent and the books Company for their approval, which shall not be unreasonably withheld, within 20 days following submission by the accountants. Parent and records the Company shall each bear one-half of the costs incurred in connection with the preparation of the Post-Closing Report and each of Parent and Company shall bear their respective expenses incurred in connection with their review of the Post-Closing Report.
(iii) In the event that either or both of the Company and its Subsidiaries. During Parent shall object to the thirty Post-Closing Report within the twenty (3020) days immediately day period following Seller’s receipt of the Closing Statementsubmission thereof, Parent and the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, submit such dispute to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered independent accountants selected by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by Arth▇▇ ▇▇▇e▇▇▇▇ ▇▇▇ ("Independent Accountants"). Parent and Seller and (ii) the date Company shall use their best efforts to cause the Independent Accountants to resolve any and all matters specified disputes regarding the Post-Closing Report as soon as is practicable, but in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not no event more than thirty (30) days following submission of such disputed matters), dispute to the Independent Accountants. The resolution of such dispute and such final determination the Post-Closing Report prepared by the Arbiter Independent Accountants shall not be subject to court review binding upon the parties hereto, absent fraud or otherwise appealablearithmetic error. The fees cost of such resolution and expenses of the Arbiter pursuant to this Section 1.5(b) preparation shall be borne shared equally by the Company, on the one hand, and Sellerby Parent, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(civ) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within Within five (5) Business Days business days after the preparation and approval of the Post-Closing Statement becomes final and binding Report pursuant to this Section 3.2, in accordance with the terms hereof, event that the Company shallPost-Closing Report shall establish a net book value for any of the items reflected in the Opening Balance Sheet (other than goodwill) of more or less than set forth in the Opening Balance Sheet (the "Adjustment"), and Buyer shall cause such Adjustment exceeds $250,000.00 in the Company toaggregate, make a payment to (X) the principal amount owing under the Note Escrow Account of shall be increased or decreased, without further action by the parties, by an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of 1) the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration plus or minus (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i2) an amount equal to the amount by which interest actually paid or payable on the Estimated Cash Consideration exceeds Adjustment during the Cash Considerationperiod from the Closing Date to and including the date the Post-Closing Report is approved (the "Adjustment Amount"), and (iiY) in the event the amount of any negative Adjustment is greater than the principal amount of the Note, the Company shall pay to Parent in cash the difference between the Adjustment Escrow Funds, in each case, from Amount and the Adjustment Escrow Account.
(d) Within five (5) Business Days after principal amount of the Closing Statement becomes final Note and binding in accordance with the terms hereof Note shall be canceled and if the Fundamental Change Repurchase Date (as such term is defined be of no further force or effect. The parties hereby agree that in the Senior Secured Notes Indenture) has not yet occurredevent the principal amount of the Note is increased or decreased pursuant to this Section 3.2, Buyer and Seller the Note shall cause be surrendered by the Escrow Agent (including by delivering joint written instructions Company to the Escrow Agent) to make Parent and a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; providedreplacement note, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth substantially in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notessame form as the Note, shall be executed and delivered in lieu thereof.
Appears in 2 contracts
Sources: Merger Agreement (Shaw Industries Inc), Merger Agreement (Maxim Group Inc /)
Post-Closing Adjustment. The Closing Merger Consideration shall be adjusted after the Closing as follows:
(a) Within ninety As soon as practicable, but in any event within one hundred and twenty (90120) days following the Closing Date, the Buyer shallshall deliver, or shall cause to be delivered, to the Company to, prepare and deliver to Seller a statement Equityholder Representative an unaudited balance sheet of the Company (the “Preliminary Closing StatementDate Balance Sheet”) setting forth its calculation as of the Cash Consideration and each close of business on the components thereof. The Closing Statement shall be Date prepared in good faith in accordance with GAAP (applied on a basis consistent with the terms application thereof to the Financial Statements) and in the form and format of Exhibit E.
(b) Subject to the resolution of any disputes pursuant to this Section 1.12, within five (5) business days after the determination of the Final Closing Date Balance Sheet (as defined below):
(i) (A) if the sum of the Estimated Net Working Capital and the Estimated Closing Cash exceeds (B) the sum of the Closing Net Working Capital and the Closing Cash (such amount resulting from subtracting the amount described in the foregoing clause (ii) from the amount described in the foregoing clause (i) being referred to hereinafter as the “Closing Shortfall”), the Buyer shall be entitled to a payment from the Company Equityholders in an amount equal to the Closing Shortfall, which shall be treated as a downward adjustment to the Closing Merger Consideration payable to the Company Equityholders for Tax purposes; and
(ii) (A) if the sum of the Closing Net Working Capital and the Closing Cash exceeds (B) the sum of Estimated Net Working Capital and the Estimated Closing Cash (such amount resulting from subtracting the amount described in the foregoing clause (ii) from the amount described in the foregoing clause (i) being referred to hereinafter as the “Closing Excess”), the Company Equityholders shall be entitled to a payment from the Buyer, in accordance with Section 1.16, in an amount equal to the Closing Excess, which shall be treated as an upward adjustment to the Closing Merger Consideration payable to the Company Equityholders for Tax purposes.
(c) In the event of a Closing Shortfall, the Buyer and the Company Equityholder Representative shall, within five (5) business days after the determination of the Final Closing Date Balance Sheet, deliver to the Escrow Agent a joint instruction letter signed by each such Party instructing the Escrow Agent to disburse from the General Escrow Fund an amount in cash equal to the Closing Shortfall to one or more accounts designated by the Buyer. If the Closing Shortfall exceeds the available General Escrow Fund (as reduced by claims for indemnification pursuant to Article VII which have previously been satisfied from the General Escrow Amount or which are then pending), the excess shall be deducted from the first proceeds of any Future Payments otherwise available for distribution to the Company Equityholders.
(d) As of the thirtieth (30th) day following the delivery thereof to the Company Equityholder Representative, the Preliminary Closing Date Balance Sheet shall be final, binding and conclusive on the Parties and all Company Equityholders for purposes of this AgreementSection 1.12 unless, including, as applicableprior to such thirtieth (30th) day, the Accounting PrinciplesCompany Equityholder Representative shall have notified the Buyer in writing of each item on the Preliminary Closing Date Balance Sheet disputed by the Company Equityholder Representative, specifying the amount thereof in dispute and setting forth, in reasonable detail, the basis for such dispute. In the event of such a dispute, the Buyer and the books Company Equityholder Representative shall attempt to reconcile their differences. If the Buyer and records the Company Equityholder Representative are unable to reach a resolution within twenty (20) days after receipt by the Buyer of the Company Equityholder Representative’s written notice of such dispute, the Buyer and its Subsidiaries. During the Company Equityholder Representative shall submit the items remaining in dispute for resolution to the Neutral Accountant, which shall, within thirty (30) days immediately following Seller’s receipt of such submission, determine and report to the Closing StatementCompany Equityholder Representative and the Buyer upon such remaining disputed items, and such report shall be final, binding and conclusive on all Parties and the Company Equityholders. In resolving any disputed items, the Company Neutral Accountant shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to apply the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this accounting principles described in Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below1.12(a). The Closing Statement Neutral Accountant shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting act as an expert and not as an arbitrator. The Preliminary Closing Date Balance Sheet that has not been challenged, has been reconciled, or has been determined by the Neutral Accountant pursuant to this Section 1.12 is referred to herein as the “Final Closing Date Balance Sheet” and shall make a final determination be final, binding and conclusive on all Parties and the Company Equityholders for purposes of this Section 1.12. The fees and disbursements of the items included in Neutral Accountant shall be allocated equally between the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on and the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or SellerCompany Equityholders, on the other hand. The Parties agree that the procedures set forth in this Section 1.12(d) for resolving disputes with respect to the Preliminary Closing Statement Date Balance Sheet, the Closing Shortfall, the Closing Excess, the Closing Net Working Capital or the Closing Cash shall (notwithstanding anything to the contrary contained in this Agreement) be the sole and exclusive procedures for resolving any such disputes, provided that nothing herein shall preclude any Party from instituting litigation in a court of competent jurisdiction to enforce the resulting calculation determination of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review Neutral Accountant or otherwise appealable. The fees and expenses any agreement of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears Parties with respect to the aggregate amount actually contested by resolution of any such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerdispute.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(de) Within five (5) Business Days business days after the Closing Statement becomes final and binding determination of the Final Adjustment Amount (as defined in accordance with the terms hereof and Schedule 1.12(e)): (i) if the Fundamental Change Repurchase Date Final Adjustment Amount is greater than zero, (as such term is defined in A) the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions be entitled to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of in an amount equal to the remaining Final Adjustment Amount, which shall be treated as a downward adjustment to the Closing Merger Consideration payable to the Company Equityholders for Tax purposes, and (B) the Buyer and the Company Equityholder Representative shall deliver to the Escrow Agent a joint instruction letter signed by each such Party instructing the Escrow Agent to disburse from the Adjustment Escrow Funds Fund an amount in cash equal to the Final Adjustment Amount to one or more accounts designated by the Buyer and, to extent the Final Adjustment Amount exceeds the available Adjustment Escrow Fund, from the General Escrow Fund (it being agreed that, if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer the Final Adjustment Amount exceeds the amount of immediately the then available funds for purposes of making an offer to repurchase the 2026 Notes Adjustment Escrow Fund and the 2025 Notes then available General Escrow Fund, the Buyer may deduct the Final Adjustment Amount from the first proceeds of any Future Payments otherwise available for distribution to the Company Equityholders); and (ii) the Buyer and the Company Equityholder Representative shall deliver to the Escrow Agent a joint instruction letter signed by each such Party instructing the Escrow Agent to disburse, for the benefit of the Company Equityholders in accordance with Section 1.8; provided1.16, that if from the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds Fund an amount in cash equal to the amount, if any, by which the Adjustment Escrow Fund exceeds the Final Adjustment Amount. The Parties shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying comply with mandatory repurchase requirements their respective obligations set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Noteson Schedule 1.12(e).
Appears in 2 contracts
Sources: Agreement and Plan of Merger, Merger Agreement (Amag Pharmaceuticals Inc.)
Post-Closing Adjustment. (a) Within ninety (90) days following If the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier sum of (i) the date any and all matters specified difference between the Closing Adjusted Statutory Capital set forth in the Notice Final Statement minus the amount of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and Estimated Adjusted Regulatory Capital, plus (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in difference between the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures Insolvency Protection Reserve Capital set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Final Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than minus the amount determined by Buyerof Estimated Insolvency Regulatory Reserve Requirement, and ▇▇▇▇▇ contests only $500 of plus (iii) the difference between the Closing Net Working Capital set forth in the Final Statement minus the amount claimed by Sellerof Estimated Net Working Capital, and if plus (iv) the Arbiter ultimately resolves difference between the dispute by awarding Closing Net Asset Value set forth in the Final Statement minus the amount of Estimated Net Asset Value, plus (v) the difference between the Closing Date Cash set forth in the Final Statement minus the amount of Estimated Closing Date Cash, plus (vi) the difference between the amount of Estimated Closing Date Indebtedness minus the Closing Date Indebtedness set forth in the Final Statement, plus (vii) the difference between the amount of Estimated Seller $300 of Transaction Expenses minus the $500 contestedSeller Transaction Expenses set forth in the Final Statement equals (A) a positive amount, then the costs and expenses Purchaser shall pay such amount in cash to the Seller, or (B) a negative amount, then the Seller shall pay the absolute value of such amount in cash to the Purchaser (such amount, if any, that either the Purchaser is obligated to pay to the Seller, or the Seller is obligated to pay to the Purchaser, being herein referred to as the “Post-Closing Adjustment”) or, in the Purchaser’s sole discretion, the Purchaser may satisfy such amounts from the Escrow Funds. Payment of the Arbiter will Post-Closing Adjustment shall be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, made within five (5) Business Days after the Closing Final Statement becomes final and binding in accordance with such.
(b) In the terms hereofevent that, following determination of the Post-Closing Adjustment, the Company shallPurchaser or any of its Affiliates (including the Transferred Entities) actually collect any portion of the Provider Advances Receivable that was not included in the calculation of Closing Net Asset Value, and Buyer the Purchaser shall cause the Company to, make a promptly remit such payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow AccountSeller.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 2 contracts
Sources: Stock and Asset Purchase Agreement (Magellan Health Inc), Stock and Asset Purchase Agreement (Molina Healthcare, Inc.)
Post-Closing Adjustment. (ai) Within As promptly as reasonably practicable, but in no event later than ninety (90) calendar days following the Closing Date, the Buyer shall, or shall cause the Company to, prepare to be prepared and deliver delivered to Seller a statement (the “Buyer Closing Statement”) setting forth its in reasonable detail the Buyer’s good faith calculation of the Adjustment Amount (including its good faith calculation of Closing Net Working Capital, Closing Indebtedness, Closing Cash Consideration and each Closing Unpaid Transaction Expenses), together with reasonable supporting documentation of such calculations. In the components thereof. The event the Buyer does not deliver to the Buyer Closing Statement in accordance with this Section 2.03, the calculations of Closing Net Working Capital, Closing Indebtedness, Closing Cash and Closing Unpaid Transaction Expenses set forth in the Estimated Closing Statement shall be prepared deemed final and binding for all purposes under this Agreement, and the Adjustment Amount (as finally determined in good faith accordance with this Section 2.03) shall be deemed to equal zero.
(ii) During the sixty (60) day period commencing upon receipt by Seller of the Buyer Closing Statement (the “Review Period”), Buyer shall provide Seller and any accountants or advisors retained by Seller with reasonable access to the books and records of the Transferred Entities for the purposes of (A) enabling Seller and its accountants and advisors to calculate, and to review Buyer’s calculation of, the Adjustment Amount as reflected in the Buyer Closing Statement and (B) identifying any dispute related to the calculation of the Adjustment Amount set forth in the Buyer Closing Statement.
(iii) If Seller disputes the Adjustment Amount set forth in the Buyer Closing Statement, then Seller shall deliver a written notice (an “Adjustment Dispute Notice”) to the Buyer prior to the expiration of the Review Period. The Adjustment Dispute Notice shall set forth, in reasonable detail, the principal basis for the dispute of such calculation and Seller’s determination of the Adjustment Amount (including its proposed calculations of Closing Net Working Capital, Closing Indebtedness, Closing Cash and Closing Unpaid Transaction Expenses and supporting documentation of such calculations).
(iv) If Seller does not deliver an Adjustment Dispute Notice to the Buyer prior to the expiration of the Review Period, the Adjustment Amount set forth in the Buyer Closing Statement shall be deemed final and binding on the Buyer and Seller as the Adjustment Amount for all purposes of this Agreement.
(v) If Seller delivers an Adjustment Dispute Notice to the Buyer prior to the expiration of the Review Period, then Seller and the Buyer shall meet, confer and exchange any additional relevant information reasonably requested by the other party regarding the computation of the Adjustment Amount for a period of twenty (20) calendar days following the delivery of the Adjustment Dispute Notice to the Buyer, and use reasonable best efforts to resolve by written agreement (the “Agreed Modifications”) any differences as to the Adjustment Amount. In the event the Buyer and Seller so resolve any such differences, the Adjustment Amount set forth in the Buyer Closing Statement, as adjusted by the Agreed Modifications shall be final and binding as the Adjustment Amount for all purposes of this Agreement. If Seller and the Buyer are unable to reach agreement on the calculation of the Adjustment Amount within the twenty (20) calendar day period following the delivery of the Adjustment Dispute Notice to the Buyer, then either Seller or the Buyer may submit the objections, including details of their views as to the correct nature and amount of each item remaining in dispute, to a nationally recognized accounting firm with an active practice area focused on post-mergers and acquisitions purchase price dispute resolution mutually acceptable to Seller and the Buyer (such firm, or any successor thereto, being referred to herein as the “Designated Accounting Firm”) after such twentieth (20th) day. In resolving any disputed item, the Designated Accounting Firm (x) shall determine Closing Net Working Capital, Closing Indebtedness, Closing Cash and Closing Unpaid Transaction Expenses in accordance with the respective definitions thereof, (y) shall limit its review to matters still in dispute as specifically set forth in the Adjustment Dispute Notice (and only to the extent such matters are still in dispute) and (z) shall act as an expert and not as an arbitrator. The Designated Accounting Firm shall be directed by the Buyer and Seller to resolve the unresolved objections as promptly as reasonably practicable in accordance with the terms of this Agreement, includingand, as applicablein any event, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the within thirty (30) calendar days immediately following of such referral, and, upon reaching such determination, to deliver a copy of its calculations (the “Expert Calculations”) to the Buyer and Seller’s receipt . In connection with the resolution of any such dispute by the Designated Accounting Firm, each of the Closing StatementBuyer, the Company shall provide Seller and its representatives their respective advisors and accountants shall have a reasonable opportunity to meet with reasonable access, during normal business hours and after reasonable advance notice, the Designated Accounting Firm to provide their respective views as to any disputed issues with respect to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration Adjustment Amount; provided, that all communications with the Designated Accounting Firm shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice include at least one Representative of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation each of the Cash Consideration shall become final Buyer and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement no party shall be revised permitted to communicate with the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ Designated Accounting Firm other than as expressly set forth herein and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence Evidence. The determination of the Adjustment Amount made by the Designated Accounting Firm shall be final and any applicable similar Law. At binding on the end of such thirty (30) day period (or such longer period as Buyer and Seller for all purposes of this Agreement, absent manifest error. The Expert Calculations (A) shall reflect in detail the differences, if any, between the calculation of the Adjustment Amount reflected in the Adjustment Dispute Notice and the calculation of the Adjustment Amount set forth in the Buyer Closing Statement, (B) with respect to any specific discrepancy or disagreement, shall be no greater than the higher amount calculated by the Buyer or Seller, as the case may agree in writing)be, and no lower than the lower amount calculated by the Buyer or Seller, as the case may be and (C) shall be based solely on the written materials submitted by the Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller .
(which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30vi) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) Designated Accounting Firm shall be borne by the CompanyBuyer, on the one hand, and Seller, on the other hand, in inverse proportion as they may prevail on the matters resolved by the Designated Accounting Firm, which proportionate allocation shall be calculated on an aggregate basis based upon on the percentage which the aggregate portion relative dollar values of the contested amount not awarded to Buyer amounts in dispute and Seller, respectively, bears shall be determined by the Designated Accounting Firm at the time the determination is rendered on the merits of the matters submitted to the aggregate amount actually contested by such partyDesignated Accounting Firm. For example, if Seller claims should the Cash Consideration is items in dispute total $1,000 greater than and the amount determined by BuyerDesignated Accounting Firm award $600 in favor of Seller’s position, and ▇▇▇▇▇ contests only $500 then 60% of the amount claimed costs of its review would be borne by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company Buyer and 40% (i.e., 200 ÷ 500) to of the costs of its review would be borne by the Seller.
(cvii) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (Adjustment Amount, as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding finally determined in accordance with this Section 2.03, is a negative number (the terms hereofabsolute value of such amount, the Company shall“Shortfall Amount”) then, and Buyer shall Seller will pay (or cause the Company to, make a payment to be paid) to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) Buyer, by wire transfer of immediately available funds for purposes of making to the account or accounts designated in writing by the Buyer to Seller, an offer amount in cash equal to repurchase the 2026 Notes and Shortfall Amount.
(viii) If the 2025 Notes Adjustment Amount, as finally determined in accordance with this Section 1.8; provided2.03, that if the Fundamental Change Repurchase Date has occurredis zero or a positive number (such positive number, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration “Excess Amount”), then Parent will promptly pay (up or cause to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agentpaid) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash ConsiderationSeller, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making to the account or accounts designated in writing by Seller to the Buyer, an offer amount in cash equal to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesExcess Amount.
Appears in 2 contracts
Sources: Equity Purchase Agreement (Joby Aviation, Inc.), Equity Purchase Agreement (Blade Air Mobility, Inc.)
Post-Closing Adjustment. Within forty-five (a) Within ninety (9045) days following after the Closing DateEffective Time, Buyer shall, or the Parent shall cause the Company to, prepare and deliver engage KPMG LLP to Seller audit a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall be balance sheet prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records generally accepted accounting principles ("GAAP") of the Company and its Subsidiariesas of 5:00 PM (EST) on the day prior to the Effective Time (the "Closing Date Balance Sheet"). During Such Closing Date Balance Sheet will utilize the thirty (30) days immediately following Seller’s receipt accrual method of accounting notwithstanding the Closing Statement, fact that the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to has heretofore utilized the books and records cash basis method of the Company accounting for purposes of their review of preparing its financial statements. If the aggregate shareholders' equity as shown on the Closing Statement. The Closing Statement and Date Balance Sheet is less than $1000 (the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then such shortfall being hereafter known as the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing"Net Worth Deficiency"), Buyer and Seller the Stockholders shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, pay within five (5) Business Days after days of the Closing Statement becomes final and binding in accordance with date of determination of the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment Net Worth Deficiency (subject to the Note Escrow Account dispute resolution procedure set forth below) (i) 45% of an amount equal the Net Worth Deficiency to the amount Parent in cash, by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) certified check or by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Considerationfunds, and (ii) 55% of the Adjustment Net Worth Deficiency in shares of Parent Stock which shall be valued at the "closing sales price" (as defined in Section 4(b)(i) of the Escrow FundsAgreement attached hereto as EXHIBIT 1.6) for the ten (10) business day period immediately preceding the date the parties reach agreement as to any Net Worth Deficiency. The Parent shall have the option, at its sole discretion and notwithstanding any language to the contrary in each casethe Escrow Agreement attached hereto, to receive the shares of Parent Stock necessary to satisfy 55% of the Net Worth Deficiency from the Adjustment Stockholders directly (i.e. not from the "Escrow Account.
Shares") or from the Escrow Shares. Notwithstanding anything in this SECTION 2 to the contrary, if there is any Net Worth Deficiency and the Stockholders dispute any item contained on the Closing Date Balance Sheet, the Stockholders shall notify the Parent in writing of each disputed item (dcollectively, the "Disputed Amounts"), and specify the amount thereof in dispute within thirty (30) Within five (5) Business Days business days after the delivery of the Closing Statement becomes Date Balance Sheet. If the Parent and the Stockholders cannot resolve any such dispute which would eliminate the amount of the Net Worth Deficiency, then such dispute shall be resolved by an independent nationally recognized accounting firm which is reasonably acceptable to the Parent and the Stockholders (the "Independent Accounting Firm"). The determination of the Independent Accounting Firm shall be made as promptly as practical and shall be final and binding in accordance with on the terms hereof parties, absent manifest error which error may only be corrected by such Independent Accounting Firm. Any expenses relating to the engagement of the Independent Accounting Firm shall be allocated between the Parent and if the Fundamental Change Repurchase Date Stockholders so that the Stockholders' aggregate share of such costs shall bear the same proportion to the total costs that the Disputed Amounts unsuccessfully contested by the Stockholders (as such term is defined in finally determined by the Senior Secured Notes IndentureIndependent Accounting Firm) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions bear to the Escrow Agent) to make a payment from total of the Adjustment Escrow Account Disputed Amounts so submitted to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesIndependent Accounting Firm.
Appears in 1 contract
Post-Closing Adjustment. 16 18 (a) Within ninety As promptly as practicable after the Closing Date (90but in no event more than sixty (60) days following after the Closing Date), Buyer shall, or the Sellers shall cause Brooks, Holmes, Will▇▇▇▇ & ▇ook ▇▇▇ (the Company to, "Sellers' Accountant") to prepare and deliver to Seller the Purchasers a statement compiled combined balance sheet of the Subject Companies as of the close of business on the day immediately preceding the Closing Date (the “"Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereofBalance Sheet"). The Closing Statement shall Balance Sheet will be prepared in good faith in accordance with GAAP, applied on a basis consistent with the terms of this Agreement, including, as applicable, Balance Sheet. Sellers' Accountant will be entitled to reasonable access during normal business hours to the Accounting Principles, relevant records and the books and records working papers of the Company Subject Companies and its Subsidiariespersonnel, including Noel ▇▇▇▇▇▇▇, ▇▇ aid in its preparation of the Closing Balance Sheet. During The Sellers will be solely responsible for all costs of the Sellers' Accountant. The Closing Balance Sheet shall be deemed to be accepted by and shall be conclusive for the purposes of the adjustment described in Sections 2.3(b) hereof with respect to the Subject Companies except to the extent, if any, that the Purchaser shall have delivered, within thirty (30) days immediately following Seller’s receipt of after the date on which the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, Balance Sheet is delivered to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (Purchaser, a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant Seller stating each and every item to this Section 1.5(a) shall specify which the Purchaser takes exception as not being in accordance with GAAP applied on a basis consistent with the Balance Sheet or as having computational errors, specifying in reasonable detail the nature and amount extent of any disagreement so asserted and attach documentation supporting Seller’s calculations.
such exception (b) it being understood that any amounts not disputed shall be paid promptly). If a timely Notice change proposed by the Purchaser is disputed by the Sellers then the Purchaser and the Sellers shall negotiate in good faith to resolve such dispute. If, after a period of Disagreement is delivered by Sellertwenty (20) days following the date on which the Purchaser gives the Sellers notice of any such proposed change, any such proposed change still remains disputed, then the Closing Statement (as revised in accordance with this Section 1.5(b)) Purchaser and the resulting calculation Sellers shall together choose an independent firm of public accountants of nationally recognized standing (the "Accounting Firm") to resolve any remaining disputes. The Accounting Firm shall act as an arbitrator to determine, based solely on presentations by the Sellers and the Purchaser and not by independent review, only those issues still in dispute. The decision of the Cash Consideration Accounting Firm shall become be final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in provisions of this Agreement (i.e., not on the basis of an independent reviewSection 2.3(a). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation All of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) Accounting Firm, if any, shall be borne paid by the Company, on Purchaser and the one hand, and Seller, on Sellers in the other hand, based upon proportions that the percentage which the aggregate portion Accounting Firm's determination of the contested amount not awarded to Buyer and Seller, respectively, Shareholders' Equity Deficiency bears to the aggregate amount actually contested Shareholders' Equity Deficiency proposals submitted by such party. For examplethe parties to the Accounting Firm; provided, however, that, if Seller claims the Cash Consideration Accounting Firm determines that either party's position is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contestedtotally correct, then the other party shall pay one hundred percent (100%) of the costs and expenses of incurred by the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerAccounting Firm in connection with any such determination.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Stock Purchase Agreement (Corporate Staffing Resources Inc)
Post-Closing Adjustment. (ai) Within ninety (90) days following after the Closing Date, Buyer shallBuyer, or with reasonable input and review by Holdings, shall cause the Company to, prepare and deliver to Seller a statement Holdings an unaudited draft balance sheet of the Company as of the time of Closing (the “Closing StatementBalance Sheet”) setting forth its ), and a calculation of the Cash Consideration and each of Net Asset Value (the components thereof. The Closing Statement shall be “Actual Net Asset Value”) prepared in good faith in accordance with the terms of this AgreementCompany Accounting Policies and Estimated Calculations as set forth in Schedule 3, includingincluding the adjustments set forth thereon, as applicable, (the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing “Actual Net Asset Value Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations).
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement post-closing adjustment shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds Closing Net Asset Value minus the Estimated Cash Consideration Net Asset Value, with a dollar for dollar adjustment (up to an excess whether positive or negative) equal to the amount of difference between the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes Closing Net Asset Value and the 2025 Notes in accordance with Section 1.8; provided, that if Estimated Net Asset Value (the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes“Post-Closing Adjustment”). If the Estimated Cash Consideration Post-Closing Adjustment is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereofa positive number, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions pay to the Escrow Agent) to make payment to Buyer (or its designees) of Holdings an amount equal to the lesser Post-Closing Adjustment, plus the Closing Adjustment Holdback. If the Post-Closing Adjustment is a negative number, the Buyer shall retain the amount of (i) an amount equal the Post-Closing Adjustment from the Closing Adjustment Holdback, and, to the amount by which extent that the Estimated Cash Consideration exceeds Closing Adjustment Holdback is insufficient to cover the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each caseentire Post-Closing Adjustment, from the Adjustment Escrow AccountHoldback to the extent of such insufficiency.
(diii) Within five (5) Business Days after From the Closing Statement becomes Date through the date of the determination of the final and binding Purchase Price Adjustment provided for in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurredthis Section 1.8, Buyer shall give Holdings and Seller shall cause the Escrow Agent (including by delivering joint written instructions its advisors reasonable access during normal business hours to the Escrow Agent) to make a payment from books and records, the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes accounting and other appropriate personnel and the 2025 Notes accountants for the Company and Buyer in accordance with Section 1.8order to review the Post-Closing Adjustment, Closing Balance Sheet and Closing Net Asset Value Statement; provided, that if such access shall be in a manner that does not interfere with the Fundamental Change Repurchase Date has occurrednormal business operations of Buyer or the Company.
(iv) For purposes of this subsection (b), the remaining Adjustment Escrow Funds shall instead be released Parties agree to Seller (allocate expenses for utilities, water, internet, phone and held sewer charges incurred in a deposit account subject to a control agreement in favor the operation of the Consenting Noteholders) for business of the sole purpose Company based on the number of complying with mandatory repurchase requirements set forth in days occurring period to the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesClosing Date and beginning on and following the Closing Date during the billing period.
Appears in 1 contract
Sources: Membership Interest Purchase Agreement (Rollins Inc)
Post-Closing Adjustment. Within forty-five (a) Within ninety (9045) days following after the Closing DateClosing, Buyer shall, or the Parent shall cause the Company to, prepare and deliver engage KPMG LLP to Seller audit a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall be balance sheet prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records generally accepted accounting principles ("GAAP") of the Company and its Subsidiaries. During as of 5:00 PM (EST) on the thirty (30) days immediately following Seller’s receipt of day prior to the Closing Statement, Date (the "Closing Date Balance Sheet"). Such Closing Date Balance Sheet will utilize the accrual method of accounting even if the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to has heretofore utilized the books and records cash basis method of the Company accounting for purposes of their review of preparing its financial statements. If the aggregate shareholders' equity as shown on the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement Date Balance Sheet is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller $100,000 (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of such shortfall being hereafter known as the Adjustment Escrow Amount) "Net Worth Deficiency"), the Stockholders shall pay the Parent in cash, by certified check or by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal Net Worth Deficiency; provided, however, that the Parent shall have the option, at its sole discretion and notwithstanding any language to the amount by which contrary in the Estimated Cash Consideration exceeds Escrow Agreement, to receive all or a portion of the Cash ConsiderationEscrow Deposit to satisfy any such Net Worth Deficiency. Notwithstanding anything in this SECTION 2 to the contrary, if there is any Net Worth Deficiency and the Stockholders dispute any item contained on the Closing Date Balance Sheet, the Stockholders shall notify the Parent in writing of each disputed item (collectively, the "Disputed Amounts"), and specify the amount thereof in dispute within thirty (ii30) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days business days after the delivery of the Closing Statement becomes Date Balance Sheet. If the Parent and the Stockholders cannot resolve any such dispute which would eliminate the amount of the Net Worth Deficiency, then such dispute shall be resolved by an independent nationally recognized accounting firm which is reasonably acceptable to the Parent and the Stockholders (the "Independent Accounting Firm"). The determination of the Independent Accounting Firm shall be made as promptly as practical and shall be final and binding in accordance with on the terms hereof parties, absent manifest error which error may only be corrected by such Independent Accounting Firm. Any expenses relating to the engagement of the Independent Accounting Firm shall be allocated between the Parent and if the Fundamental Change Repurchase Date Stockholders so that the Stockholders' aggregate share of such costs shall bear the same proportion to the total costs that the Disputed Amounts unsuccessfully contested by the Stockholders (as such term is defined finally determined by the Independent Accounting Firm) bear to the total of the Disputed Amounts so submitted to the Independent Accounting Firm. Notwithstanding any provision to the contrary, in the Senior Secured Notes Indentureevent the Stockholders are obligated to pay the Parent a Net Worth Deficiency, each Stockholder shall only be obligated to pay the Parent his share of the Net Worth Deficiency, calculated by multiplying such Stockholder's percentage ownership in the Company (as reflected on Schedule 3.4) has not yet occurredby the Net Worth Deficiency, Buyer and Seller as the Net Worth Deficiency shall cause be a several obligation of the Escrow Agent (including by delivering joint written instructions Stockholders." Notwithstanding anything herein to the Escrow Agent) to make a payment from contrary, the Adjustment Escrow Account Company shall have the absolute right prior to the Note Escrow Account of an amount equal Closing to distribute to the remaining Adjustment Escrow Funds Stockholders any earnings of the Company so long as a Net Worth Deficiency is not created. In the event that the aggregate shareholders' equity of the Company exceeds $100,000 on the Closing Date Balance Sheet (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred"Net Worth Surplus"), the remaining Adjustment Escrow Funds shall instead be released Parent acknowledges its obligation to Seller (and held remit the Net Worth Surplus to the Stockholders in a deposit account subject to a control agreement in favor cash or certified check within 30 days of the Consenting Noteholders) for date that the sole purpose of complying with mandatory repurchase requirements set forth in Closing Date Balance Sheet is delivered and accepted by the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesparties hereto.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety As soon as practicable, but in any event no later than one hundred twenty (90120) days following the Closing Date, the Buyer shall, or shall cause to be prepared and delivered to the Company to, prepare Seller the Audited Closing Date Balance Sheet and deliver to Seller a statement (the “Closing Statement”) setting forth its calculation the Working Capital Adjustment as of the Cash Consideration and each close of business on the components thereofClosing Date (such statement, as it may be adjusted pursuant to Section 2.8(b), the "Closing Date Statement"). The Closing Date Statement shall be prepared in good faith in accordance with GAAP and consistent with the terms methodologies set forth in Schedule 1.1 of this Agreement, including, as applicableExhibit B. Upon receipt of the Audited Closing Date Balance Sheet and the Closing Date Statement, the Accounting Principles, Seller and the books and records of Seller's independent accountants shall be permitted during the Company and its Subsidiaries. During the succeeding thirty (30) days immediately following Seller’s receipt of day period to examine the Audited Closing Date Balance Sheet, the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Date Statement and the resulting calculation work papers used or generated in connection with the preparation of such documents and such other documents as the Cash Consideration shall become final and binding upon the parties hereto Seller may reasonably request in connection with its review. If, within thirty (30) days following Seller’s receipt thereof unless delivery of the Audited Closing Date Balance Sheet and the Closing Date Statement, the Seller delivers written shall not have given the Buyer notice of its disagreement (a “Notice the Seller's objection to the Audited Closing Date Balance Sheet or any of Disagreement”) to Buyer prior to such date; provided that the computations in the Closing Date Statement (which notice shall contain a statement of the Basis of such objection), then the Audited Closing Date Balance Sheet and the resulting calculation of the Cash Consideration shall become Closing Date Statement will be final and binding upon the parties upon Seller’s deliveryParties, prior absent manifest error. If the Seller gives notice to the expiration Buyer of the thirty (30) day periodSeller's objection, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and the Seller are finally resolved unable to resolve the issues in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the dispute within thirty (30) days immediately following the after delivery of a Notice such notice of Disagreement or such longer period as Buyer objection, each of the Buyer's and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have the Seller's positions with respect to any matter specified the Audited Closing Date Balance Sheet and the computation of the Working Capital Adjustment in the Notice of DisagreementClosing Date Statement will be submitted to Deloitte Touche LLP, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (independent certified public accountants, or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice other firm of Disagreement to a nationally-recognized independent accounting firm that is certified public accountants mutually selected by ▇▇▇▇▇ and Seller the Parties (the “Arbiter”"Accountants") for review and resolution. Buyer and Seller shall instruct If the Arbiter to, Audited Closing Date Balance Sheet and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination computation of the items included in the Closing Statement (Working Capital Adjustment are submitted to the extent Accountants for resolution, (x) each Party will furnish to the Accountants such amounts workpapers and other documents and information relating to the disputed issues as the Accountants may request and are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement available to that Party (i.e., not on the basis of an or its independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matterspublic accountants), and will be afforded the opportunity to present to the Accountants any material relating to such issues and to discuss the same with the Accountants; (y) the Accountant's shall select either the Buyer's or the Seller's position on each disputed matter in the Audited Closing Date Balance Sheet and the Working Capital Adjustment in its entirety and such selection shall be binding and conclusive on the Parties and will be deemed to be the Audited Closing Date Balance Sheet and the final determination by Working Capital Adjustment for the Arbiter shall not be subject to court review or otherwise appealable. The Closing Date Statement; and (z) the fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall Accountants for such determination will be borne by the CompanyParty whose positions have a net negative economic adjustment, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellertaking into account all disputed matters.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(db) Within five (5) Business Days after of the Closing Statement becomes final and binding in accordance with completion of the terms hereof and computations required by Section 2.8(a), (i) if the Fundamental Change Repurchase Date (as such term is defined Working Capital Balance in the Senior Secured Notes Indenture) has not yet occurredAudited Closing Date Balance Sheet is less than $19 Million, Buyer and then the Seller shall cause the Escrow Agent (including by delivering joint written instructions pay to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of Buyer an amount equal to the remaining Working Capital Adjustment Escrow Funds and (ii) if any) after any payments are made the Working Capital Balance in the Audited Closing Date Balance Sheet is greater than $19 Million, then the Buyer shall pay to Buyer pursuant the Seller an amount equal to Section 1.5(c) (if any) the Working Capital Adjustment. In either case, such amounts shall be paid by wire transfer of immediately available funds for purposes to such account or accounts of making an offer to repurchase the 2026 Notes and Buyer or the 2025 Notes in accordance with Section 1.8Seller, as the case may be, as may be designated by the Buyer or the Seller, as the case may be; provided, however, that if amounts owed by the Fundamental Change Repurchase Date has occurredSeller to the Buyer may be netted against amounts owed by the Buyer to the Seller, and vise versa. If payment is being made after the fifth business day referred to in this Section 2.8(b), the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor amount of the Consenting Noteholderspayment to be made pursuant to this Section 2.8 shall bear interest from and including such fifth business day to, but excluding, the date of payment at a rate per annum equal to seven percent (7%) for the sole purpose first thirty days such payment is past due and at a rate per annum equal to fifteen percent (15%) for all subsequent periods such payment is past due, in either event not to exceed the maximum rate permitted by Law. Such interest shall be payable at the same time as the payment to which it relates and shall be calculated on the basis of complying with mandatory repurchase requirements a year of 365 days and the actual number of days for which due.
(c) After the Closing Date, the Seller will furnish, or cause to be furnished to the Buyer, its accountants and auditors, upon request of the Buyer and as promptly as practicable, such information and assistance as is reasonably necessary for the Buyer to cause to be prepared the Audited Closing Date Balance Sheet and the Closing Date Statement.
(d) Except as set forth in Section 2.8(a), the Senior Secured Notes Supplemental Indenture Buyer and the Seller shall each bear its own expenses incurred in connection with respect to any remaining 2025 Notesthe preparation and review of the Audited Closing Date Balance Sheet and the Closing Date Statement.
Appears in 1 contract
Sources: Purchase and Sale Agreement (Alpha Natural Resources, Inc.)
Post-Closing Adjustment. (a) Within ninety ten (9010) business days following after the Closing Date, Buyer shall, or Seller shall cause determine the Company to, prepare and deliver to Seller a statement amount of the Transferred Inventory Value as of the Closing Date (the “Closing StatementTransferred Inventory Value”) setting forth its calculation and deliver a statement of the Cash Consideration and each of the components thereof. The such Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, Transferred Inventory Value to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsPurchaser.
(b) If a timely Notice The Closing Transferred Inventory Value shall be determined in accordance with U.S. generally accepted accounting principles applied consistently with the past practices of Disagreement Seller and the preparation of the Reference Balance Sheet. Such Closing Transferred Inventory Value shall exclude any purchase price accounting adjustments Purchaser is delivered required to make under U.S. generally accepted accounting principles.
(c) In the event Purchaser does not agree as to the amount of the Closing Transferred Inventory Value as determined by Seller, then Purchaser shall deliver to Seller a written statement describing with reasonable detail the basis for any such claim within fifteen (15) business days after receiving Seller’s statement of Closing Statement (as revised in accordance with this Section 1.5(b)) Transferred Inventory Value and the resulting shall prepare its own calculation of the Cash Consideration Closing Transferred Inventory Value. Purchaser and Seller will then use reasonable efforts to resolve any such claims on the Closing Transferred Inventory Value themselves. If they do not obtain a final resolution within forty-five (45) business days after the Closing Date, however, Purchaser and Seller will select an accounting firm from among the “Final Four” accounting firms mutually acceptable to them to resolve any remaining such claims. If Purchaser and Seller are unable to agree on the choice of an accounting firm, they will select a nationally recognized accounting firm by lot (after Asset Purchase Agreement Execution Version excluding any such firm engaged by Purchaser, Seller or their Affiliates) (the “Arbitrating Accountant”). Upon submission to the Arbitrating Accountant for resolution, Purchaser and Seller shall become each indicate in writing its position on each disputed matter. The Arbitrating Accountant shall make a written determination on the final amount of Closing Transferred Inventory Value (the “Final Closing Transferred Inventory Value”) no later than 180 days after the Closing Date and such determination will be conclusive and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ Purchaser and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) Arbitrating Accountant shall be borne entirely paid by the Company, on the one hand, and party (Purchaser or Seller, on the other hand, based upon the percentage which ) against whom in excess of 50% of the aggregate portion disputed amount is determined by the Arbitrating Accountant, or if 50% of the contested aggregate disputed amount not awarded to Buyer is determined against each party then each party shall pay one-half of such fees and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerexpenses.
(cd) Purchaser will make the work papers and back-up materials necessary for the determination of the Closing Transferred Inventory Value, and any books, records and financial staff of the CNS Division, available to Seller and its accountants and other representatives and to the Arbitrating Accountant resolving any claim concerning the Closing Transferred Inventory Value at reasonable times and upon reasonable notice at any time during (i) the determination of the Closing Transferred Inventory Value, and (ii) the resolution by Purchaser and Seller and/or the Arbitrating Accountant of any objections thereto.
(e) Seller will make the work papers and back-up materials used in the determination of the Closing Transferred Inventory Value, and its financial staff and other relevant employees available to Purchaser and its accountants and other representatives and to the Arbitrating Accountant resolving any claim concerning the Closing Transferred Inventory Value at reasonable times and upon reasonable notice at any time during (i) the determination of the Closing Transferred Inventory Value, (ii) the review by Purchaser of the Closing Transferred Inventory Value, and (iii) the resolution by Purchaser and Seller and/or the Arbitrating Accountant of any objections thereto.
(f) The Purchase Price will be adjusted if the Closing Transferred Inventory Value as determined under this Section 2.4 is greater than or less than the Target Value. If the Cash Consideration Undisputed Closing Transferred Inventory Value is greater than the Estimated Cash Consideration and Target Value, then the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make Purchase Price will be increased accordingly on a payment to the Note Escrow Account dollar-for-dollar basis of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) such excess and such amount will be paid by Purchaser and/or IP Purchaser to Seller by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal account designated by Seller in writing, no later than five business days after the date for delivery of Purchaser’s statement pursuant to the first sentence of Section 2.4(c), whether or not such statement is delivered. If the Undisputed Closing Transferred Inventory Value is less than the Target Value, then the Purchase Price will be decreased on a dollar-for-dollar basis by the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer deficiency and Seller shall cause the Escrow Agent (including by delivering joint written instructions will pay such amount to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) Purchaser by wire transfer of immediately available funds for purposes to an account designated by Purchaser and IP Purchaser in writing, no later than five business days after the date provided in the previous sentence. If an Arbitrating Accountant determines Final Closing Transferred Inventory Value pursuant to Section 2.4(c), then within five business days of making an offer to repurchase such determination: (i) if the 2026 Notes Final Closing Transferred Inventory Value is greater than the Undisputed Closing Transferred Inventory Value, then the Purchase Price will be increased accordingly and the 2025 Notes in accordance with Section 1.8difference between the Final Closing Transferred Inventory Value and the Undisputed Closing Transferred Inventory Value shall be paid by Purchaser and/or IP Purchaser by wire transfer to the account designated by Seller; provided, that or (ii) if the Fundamental Change Repurchase Date has occurredFinal Closing Transferred Inventory Value is less Asset Purchase Agreement Execution Version than the Undisputed Closing Transferred Inventory Value, then the remaining Adjustment Escrow Funds Purchase Price will be decreased accordingly and the difference between the Final Closing Transferred Inventory Value and the Undisputed Closing Transferred Inventory Value shall instead be released paid by Seller by wire transfer to Seller (an account designated by Purchaser. There shall be no adjustment to the Purchase Price and held in a deposit account subject no payment by any Party if any amount to a control agreement in favor of the Consenting Noteholdersbe paid pursuant to this Section 2.4(f) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Noteswould be less than $10,000.
Appears in 1 contract
Sources: Asset Purchase Agreement
Post-Closing Adjustment. (ai) Within ninety (90) days following the Closing Date, Buyer shall, or Purchaser shall cause the Company to, prepare and deliver to Seller within ninety (90) calendar days following the Closing Date a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each Closing Working Capital, which statement shall contain a balance sheet of the components thereofBusiness as of the Closing Date (without giving effect to the transactions contemplated herein) and a calculation of the Closing Working Capital (the “Closing Date Statement”). The Closing Date Statement shall be prepared in good faith the manner set forth in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records Section 3.2(b)(i) of the Company and its Subsidiaries. During the thirty Peanuts Transaction Agreement.
(30ii) If Seller does not notify Purchaser in writing within forty-five (45) calendar days immediately following after Seller’s receipt of the Closing Date Statement that it disputes any of the information or calculations provided to Seller in the Closing Date Statement, the Company Closing Date Statement shall provide be final and conclusive. If Seller and its representatives disagrees with reasonable access, during normal business hours and after reasonable advance notice, to the books and records any of the Company for purposes of their review of information or calculations provided by Purchaser in the Closing Date Statement. The Closing Statement and the resulting calculation , Seller may, within forty-five (45) calendar days after delivery of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (such statement to it, deliver a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer Purchaser stating the existence and nature of its acceptance of the Closing Statementsuch disagreement. Any Notice such notice of Disagreement delivered pursuant to this Section 1.5(a) disagreement shall specify in those items or amounts as to which Seller disagrees. If such notice of disagreement is delivered, the parties shall use their reasonable detail best efforts to reach agreement on the nature and amount disputed items or amounts within ten (10) Business Days after Purchaser’s receipt of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) such notice. If a timely Notice of Disagreement is delivered by Sellerthe parties are unable to reach agreement on the disputed items within such period, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain issues in dispute and which were properly included in the Notice of Disagreement will be submitted to a nationally-mutually agreed firm of nationally recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller certified public accountants (the “ArbiterAccountants”) for review and resolution, with instructions to complete the review as promptly as practicable. Buyer Each party will furnish to the Accountants such workpapers and Seller other documents and information relating to the disputed issues as the Accountants may request and are available to that party or its Affiliates (or its independent public accountants), and will be afforded the opportunity to present to the Accountants any material relating to the determination and to discuss the determination with the Accountants. The parties shall instruct the Arbiter to, and Accountants that their determination shall not result in a Peanuts Adjustment in an amount higher than the Arbiter, acting as Peanuts Adjustment proposed by Seller (or its Affiliates) or an expert and not an arbitrator, shall make a final determination amount lower than the Peanuts Adjustment proposed by Purchaser. The resolution of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and Accountants in accordance with the guidelines and procedures set forth in provisions of this Agreement (i.e., not on the basis of an independent review). Buyer and Seller Section 3.2 shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final be conclusive and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ parties. Seller and Seller, on Purchaser shall each pay one-half of the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of charged by the Arbiter Accountants.
(iii) The Closing Working Capital determined pursuant to this Section 1.5(b3.2(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded used to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration determine whether there is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date a “Working Capital Deficiency” or a “Working Capital Excess” (as such term is terms are defined in the Senior Secured Notes IndenturePeanuts Transaction Agreement) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c3.2(b)(iii) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesPeanuts Transaction Agreement.
Appears in 1 contract
Sources: Membership Interest Purchase Agreement (Iconix Brand Group, Inc.)
Post-Closing Adjustment. The Purchase Price shall be subject to adjustment after the Closing as follows:
(a) Within ninety sixty (9060) days following after the Closing Date, Buyer shall, or Seller Parent shall cause the Company to, prepare and deliver to Seller Buyer a statement (the “Closing Statement”) setting forth its calculation of calculating the Cash Consideration and each of Closing Inventory Value, which shall be calculated in accordance with GAAP applied in a manner consistent with the components thereofAccounting Principles. The Closing Statement shall include a statement listing detail by SKU of the Inventory, including the quantity, expiry dating and original cost to Sellers of each item in Inventory. The Closing Inventory Value shall be based on a physical count of the Inventory conducted within ten (10) Business Days of the Closing. Buyer shall be allowed to be present at and observe such physical count.
(b) If Buyer disputes the Closing Inventory Value as shown on the Closing Statement prepared in good faith by Seller Parent, Buyer shall deliver to Seller Parent within sixty (60) days after receipt of the Closing Statement a notice setting forth Buyer’s calculation of the Closing Inventory Value (which shall be calculated in accordance with Section 3.3(a)) and describing in detail the terms basis for the determination of this Agreement, including, as applicable, such different Closing Inventory Value (the Accounting Principles“Dispute Notice”, and each item in dispute, a “Disputed Item”). Buyer and Seller Parent shall use reasonable efforts to resolve the books and records Disputed Items for a period of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt after Buyer has given the Dispute Notice.
(c) If Buyer and Seller Parent have not resolved all of the Closing StatementDisputed Items (any such unresolved items, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto “Unresolved Items”) within thirty (30) days following Seller’s receipt thereof after Buyer has given the Dispute Notice, unless the Parties mutually agree in writing to continue their efforts to resolve such differences, then, within fifteen (15) days after the expiration of such period, Buyer and Seller delivers written notice Parent shall submit the Unresolved Items to a jointly appointed independent and impartial certified public accountant who is a partner at a neutral nationally recognized accounting firm in the United States that is not the auditor or independent accounting firm of, and is otherwise independent of, the Parties and any of its disagreement their respective Affiliates (a the 28 “Notice of DisagreementTransaction Arbitrator”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become for final and binding upon arbitration. If the parties upon Seller’s delivery, prior Parties are unable to timely appoint a Transaction Arbitrator within fifteen (15) days of the expiration of the thirty (30) day periodresolution period described above, of written notice to either Buyer of its acceptance of or Seller Parent may request that the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail American Arbitration Association appoint the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolutionTransaction Arbitrator. Buyer and Seller shall instruct the Arbiter toParent, and the Arbiter, acting as an expert and not an arbitratorin respect of Sellers, shall make a final determination of each bear the items included respective fees and costs incurred by the Parties in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance connection with the guidelines and procedures matters set forth in this Agreement (i.e.Section 3.3(c), not on except that the basis of an independent review). Buyer fees and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation disbursements of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination Transaction Arbitrator shall be requested paid by ▇▇▇▇▇ Buyer or Seller Parent in proportion to those matters submitted to the Transaction Arbitrator that are resolved against Buyer or Seller Parent, as applicable, as such fees and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination disbursements are allocated by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter Transaction Arbitrator pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerforegoing.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Purchase and Sale Agreement
Post-Closing Adjustment. (ai) Within As promptly as practicable, but in no event later than ninety (90) calendar days following the Closing Date, Buyer shall, or Acquiror shall cause to be prepared, in accordance with GAAP and, to the extent consistent with GAAP, using the same principles, methodologies and judgments as used by the Company toin the preparation of the Estimated Closing Statement, prepare and deliver delivered to Seller the Members, a statement (the “Acquiror Closing Statement”) setting forth its in reasonable detail Acquiror’s good-faith calculation of the Cash Consideration Net Working Capital and each attaching all relevant backup materials and schedules.
(ii) From and after the delivery of the components thereof. The Acquiror Closing Statement Statement, Acquiror shall be prepared in good faith in accordance provide the Members and any accountants or advisors retained by the Members or the Company pre-Closing with the terms of this Agreement, including, as applicable, the Accounting Principles, and reasonable access to the books and records of the Company and its Subsidiaries. During cause appropriate representatives of Acquiror to be reasonably available to discuss the thirty (30) days immediately following Seller’s receipt Acquiror Closing Statement and respond to reasonable questions of the Members and its accountant with regard thereto, solely for the purposes of: (A) enabling the Members and its accountants and advisors to calculate and to review Acquiror’s calculations as reflected in the Acquiror Closing Statement and (B) identifying any dispute related to the calculations set forth in the Acquiror Closing Statement.
(iii) If the Members dispute the calculation of the Net Working Capital set forth in the Acquiror Closing Statement, then the Company Members shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers deliver a written notice of its disagreement (a an “Notice of DisagreementAdjustment Dispute Notice”) to Buyer prior to such date; provided that Acquiror during the 45-day period commencing upon receipt by the Members of the Acquiror Closing Statement and (the resulting “Review Period”). The Adjustment Dispute Notice shall set forth, in reasonable detail, the basis for the dispute of such calculation including their proposed calculation along with a brief explanation.
(iv) If the Members do not deliver an Adjustment Dispute Notice meeting the requirements of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, Section 2.5(b)(iii) to Acquiror prior to the expiration of the Review Period, Acquiror’s calculations of the Net Working Capital shall be deemed final and binding on Acquiror, the Company and the Members for all purposes of this Agreement.
(v) If the Members deliver an Adjustment Dispute Notice to Acquiror prior to the expiration of the Review Period with respect to Acquiror’s calculation of the Net Working Capital, then the Members and Acquiror shall jointly meet, confer and exchange any additional relevant information reasonably requested by the other party regarding the computation of Net Working Capital for a period of thirty (30) calendar days after the end of the Review Period, and use reasonable efforts to resolve by written agreement (the “Agreed Adjustments”) any differences as to the Net Working Capital. In the event Acquiror and the Members so resolve any such differences, Acquiror’s calculations set forth in the Acquiror Closing Statement, as adjusted by the Agreed Adjustments, shall be final and binding for purposes of this Agreement. If the Members and Acquiror are unable to reach agreement on any disputed item within the 30 calendar day period, of written notice then either the Members or Acquiror may submit the objections to Buyer of its acceptance of a nationally recognized accounting firm that regularly audits U.S. publicly listed companies, which is agreed upon by Acquiror and the Members within sixty (60) calendar days after the Closing Statementand has not previously represented the Company, the Acquiror, the Sponsor or any of their Affiliates (such firm, or any successor thereto, being referred to herein as the “Designated Accounting Firm”) after such 30th day. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) The Designated Accounting Firm shall specify in reasonable detail the nature act as an expert and amount of any disagreement so asserted not an arbitrator and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered shall be directed by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in Members to resolve the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (unresolved objections as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter promptly as reasonably practicable in accordance with GAAP and the terms of this Section 1.5Agreement, and, in any event, within forty five (45) calendar days of such referral, and, upon reaching such determination, to deliver a copy of its calculations (the “Expert Calculations”) to the Members and Acquiror. During In connection with the thirty resolution of any such dispute by the Designated Accounting Firm, each of Acquiror, the Members and their respective advisors and accountants shall have a reasonable opportunity to meet with the Designated Accounting Firm to provide their respective views as to any disputed issues with respect to the calculation of the Net Working Capital. The determination of Net Working Capital made by the Designated Accounting Firm shall be final and binding on Acquiror and the Members for all purposes of this Agreement, absent manifest error. In calculating the Net Working Capital, the Designated Accounting Firm shall be limited to addressing only the particular disputes referred to in the Adjustment Dispute Notice. The Expert Calculations (30A) days immediately following shall reflect in detail the delivery of a Notice of Disagreement or such longer period as Buyer differences, if any, between the disputed items reflected therein and Seller may agree the disputed items set forth in writingthe Acquiror Closing Statement, Buyer and Seller may attempt to resolve any differences which they may have (B) with respect to any matter specified in the Notice of Disagreementspecific discrepancy or disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute no greater than the greatest value for such item assigned higher amount calculated by BuyerAcquiror or the Members, on as the one handcase may be, or Seller, on the other hand, or less and no lower than the smallest value for such item assigned lower amount calculated by BuyerAcquiror or the Members, on as the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealablecase may be. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) Designated Accounting Firm shall be borne paid by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇▇▇▇ contests only $500 of and the Members in inverse proportion as they may prevail (based on the disputed items as resolved by the Designated Accounting Firm as compared to the disputed items proposed by ▇▇▇▇▇▇▇▇ and the Members, respectively), as determined by the Designated Accounting Firm.
(vi) If the Net Working Capital, as finally determined in accordance with this Section 2.5, is less than the estimated Net Working Capital (the amount claimed by Sellerof such excess, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested“Overpayment Amount”), then the costs Members shall promptly, and expenses in any event within three (3) Business Days after such final determination, deliver an amount in cash equal to their Pro Rata Shares of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) such Overpayment Amount to the Company and 40% (i.e., 200 ÷ 500) to SellerAcquiror.
(cvii) If the Cash Consideration Net Working Capital, as finally determined in accordance with this Section 2.5, is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date estimated Net Working Capital (as such term is defined in the Senior Secured Notes Indenture) has not yet occurredamount, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof“Shortfall Amount”), the Company shall, and Buyer then Acquiror shall promptly cause the Company to, make a payment to the Note Escrow Account distribute to each Member in respect of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount such Member’s Pro Rata Share of the Adjustment Escrow such Shortfall Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Membership Interest Purchase Agreement (Stratim Cloud Acquisition Corp.)
Post-Closing Adjustment. (a) Within ninety (90) 90 days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller the Sellers Representative the Closing Balance Sheet and a statement calculation of the Adjustment Amount and the Cash Consideration based upon such Closing Balance Sheet (the “Closing StatementFinal Cash Consideration”). The Sellers Representative and a single firm of independent public accountants designated by the Sellers Representative (the “Sellers’ Accountants”) setting forth its calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall will be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, entitled to full access during normal business hours and after reasonable advance notice, to the books relevant records and records working papers of the Company for purposes of Buyer to aid in their review and understanding of the Closing StatementBalance Sheet, Adjustment Amount, and Final Cash Consideration. In addition, if requested by the Sellers Representative, Buyer shall provide Sellers documentation regarding the current payment status of the liabilities set forth on the Closing Balance Sheet. Sellers will be solely responsible for all costs of the Sellers’ Accountants. The Closing Statement Balance Sheet, Adjustment Amount, and the resulting calculation of the Final Cash Consideration shall become final be deemed to be accepted by and binding upon shall be conclusive for the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation purposes of the Cash Consideration adjustment described in this Section 3.4(b) with respect to Sellers unless the Sellers Representative shall become final and binding upon have delivered, within 30 days after the parties upon Seller’s deliverydate on which such Closing Balance Sheet is received by the Sellers Representative, prior to the expiration of the thirty (30) day period, of a written notice to Buyer of its acceptance of stating each and every item to which the Closing Statement. Any Notice of Disagreement delivered pursuant to Sellers Representative takes exception as not being in accordance with GAAP, this Section 1.5(a) shall specify Agreement or otherwise being incorrect, specifying in reasonable detail the nature and amount extent of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) such exception. If a timely Notice of Disagreement is delivered change proposed by Sellerthe Sellers Representative disputed by Buyer, then Buyer and the Closing Statement Sellers Representative shall negotiate in good faith to resolve such dispute. If, after a period of 10 days following the date on which the Sellers Representative gives Buyer notice of any such proposed change, any such proposed change still remains disputed, then PricewaterhouseCoopers LLP, or such other independent public accountants mutually agreed upon (as revised the “Accounting Firm”), shall resolve any remaining disputes. The Accounting Firm shall determine, based on presentations by the Sellers Representative and Sellers’ Accountants and Buyer and its accounting firm, and any independent review Accounting Firm deems necessary to meet its professional obligations, only those issues still in accordance with dispute. The Accounting Firm shall deliver to the Sellers Representative and Buyer, within 30 days following the date on which the Sellers Representative gave Buyer notice of an exception (and which exception was subsequently disputed by Buyer and submitted to the Accounting Firm pursuant to this Section 1.5(b3.4(b)) and the resulting calculation ), a report setting forth its findings. The decision of the Cash Consideration Accounting Firm shall become be final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines provisions of this Agreement. All of the fees and procedures set forth in this Agreement (i.e., not on expenses of the basis of an independent review). Buyer and Seller Accounting Firm shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by be allocated between Buyer, on the one hand, or Sellerand Sellers, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, Accounting Firm based upon the percentage which the aggregate portion of the contested amount not awarded to resolved in favor of Buyer and Selleror Sellers, respectivelyas the case may be, bears to the aggregate amount actually contested disputed by such partyParties. For example, if Seller claims the Cash Consideration is Sellers Representative contests $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by SellerAdjustment Amount determined from the Closing Balance Sheet, and if the Arbiter Accounting Firm ultimately resolves the dispute in favor of Sellers by awarding Seller $300 600 of the $500 contested1,000 amount in dispute, then the costs and expenses of the Arbiter Accounting Firm will be allocated 60% (i.e., 300 ÷ 500600/1,000) to the Company Buyer and 40% (i.e., 200 ÷ 500400/1,000) to SellerSellers.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Stock and Asset Purchase Agreement (Maxum Petroleum Holdings, Inc.)
Post-Closing Adjustment. (a) After the Closing Date, the Sellers and Purchaser shall cooperate with each other and provide each other with such access to their respective relevant books, records (including, closing trial balances and detailed reconciliations of balance sheet accounts) and employees (and those of the Acquired Companies) as they may reasonably request in connection with the matters addressed in this Section 2.05. Within ninety (90) days following after the Closing Date, Buyer shall, or Purchaser shall cause the Company to, prepare and deliver to Seller the Sellers a statement (the “Closing Purchaser’s Statement”) setting forth its calculation of the Cash Consideration and each of Purchase Price (including the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicableDate Net Working Capital Adjustment Amount, the Accounting Principles, RGGI Adjustment Amount and the books Closing Date Net Indebtedness Amount) together with reasonable supporting information and records of calculations.
(b) If the Company and its Subsidiaries. During Sellers object to any matter set forth on the Purchaser’s Statement, then they shall provide Purchaser written notice thereof within thirty (30) days immediately after receiving the Purchaser’s Statement, which notice shall specify in reasonable detail the basis for such dispute and the disputed items; provided, that the Sellers and Purchaser shall be deemed to have agreed upon all items and amounts that are not disputed by the Sellers in such written notice. If the Parties are unable to agree on any matter set forth on the Purchaser’s Statement disputed by the Sellers in accordance with this Section 2.05(b), within one hundred thirty-five (135) days after the Closing Date, the Parties shall refer such dispute to KPMG LLP or, if KPMG LLP declines to act as provided in this Section 2.05(b), a firm of independent public accountants, mutually acceptable to Purchaser and the Sellers (the “Independent Accountants”), and the Parties shall cause such firm to make a final and binding determination as to only those matters in dispute with respect to this Section 2.05(b) on a timely basis, and, in any event, within thirty (30) days following Seller’s receipt its appointment, and shall cause such firm promptly to notify the Parties in writing of its resolution. The Parties shall not authorize the Independent Accountants to modify or amend any term or provision of this Agreement or modify items previously agreed among the Parties. The fees and other costs charged by the Independent Accountants shall be borne by Purchaser and the Sellers in proportion to the amounts by which their proposed calculations of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, Purchase Price as initially submitted to the books and records of Independent Accountant differed from the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting Independent Accountant’s final calculation of the Cash Consideration Purchase Price divided by the aggregate amount by which such proposed calculations of the Purchase Price differed from the Independent Accountant’s final calculation of the Purchase Price. If the Sellers do not object to any matter set forth on the Purchaser’s Statement within the time period and in the manner set forth in the first sentence of this Section 2.05(b) or if the Sellers accept the Purchaser’s Statement, then the Purchaser’s Statement shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and Parties for all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerpurposes hereunder.
(c) If the Cash Consideration is greater than Purchase Price, as finally determined as provided in Section 2.05(b) (as agreed between the Parties or as determined by the Independent Accountants), (i) exceeds the Estimated Cash Consideration Purchase Price, then Purchaser shall pay the Sellers and shall pay the Fundamental Change Repurchase Date Company to pay to the Optionholders an amount equal to the amount of such excess (as such term is defined in to be apportioned among the Senior Secured Notes Indenture) has not yet occurredSellers and Optionholders pursuant to the percentages set forth on the Payout Schedule), within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereofsuch amounts are agreed or determined pursuant to Section 2.05(b), the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making to an offer account or accounts designated with respect to repurchase such Sellers in the 2026 Notes Payout Schedule, (ii) is less than the Estimated Purchase Price, then Purchaser and the 2025 Notes Sellers shall notify the Escrow Agent to disburse to Purchaser from the Escrow Account in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the Escrow Agreement an amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, such shortfall within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereofsuch amounts are agreed or determined pursuant to Section 2.05(b), Buyer and the Seller shall cause the Escrow Agent or (including by delivering joint written instructions to the Escrow Agentiii) to make payment to Buyer (or its designees) of an amount is equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash ConsiderationPurchase Price, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller then no payment shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are be made to Buyer pursuant to this Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes2.05.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety (90) 90 days following after the Closing Date, Buyer shall, or shall cause the Company to, Holdco will prepare and deliver (i) to the NWMI Sellers’ Representative a statement setting forth Holdco’s calculation of (A) the NWMI NWC Adjustment, calculated in accordance with GAAP applied on a basis consistent with the policies, procedures, practices, judgments and methodologies used in preparing the sample calculations contained in Schedule 1.1(b)(i), (B) the Outstanding Debt of the NWMI Acquired Companies and (C) the Transaction Expenses of the NWMI Acquired Companies and the NWMI Sellers (the “NWMI Closing Statement”), and (ii) to Valley Seller a statement setting forth Holdco’s calculation of (A) the Valley NWC Adjustment, calculated in accordance with GAAP applied on a basis consistent with the policies, procedures, practices, judgments and methodologies used in preparing the sample calculations contained in Schedule 1.1(b)(ii), (B) the Outstanding Debt of the Valley Acquired Companies and (C) the Transaction Expenses of the Valley Acquired Companies and Valley Seller (the “Valley Closing Statement”), in each case as of immediately prior to the Closing (such statements being referred to collectively as the “Closing Statements”).
(b) setting forth its calculation The NWMI Sellers’ Representative and Valley Seller will each have 30 days to review their respective Closing Statements after receipt thereof (the “Review Period”). Holdco shall provide the NWMI Sellers’ Representative and Valley Seller and their representatives reasonable access at reasonable times and upon reasonable notice to the records, properties, personnel and (subject to the execution of customary work paper access letters if requested) auditors relating to the preparation of the Cash Consideration applicable Closing Statement and each shall cause its personnel to reasonably cooperate with the NWMI Sellers’ Representative and Valley Seller in connection with their review; provided, that any such access, or the furnishing of any information in connection therewith, shall be conducted during normal business hours, for a reasonable amount of time and in such a manner as not to unreasonably interfere with the normal operations of the components thereofbusiness of Holdco or the Acquired Companies. The Each Closing Statement shall will be prepared in good faith in accordance with binding and conclusive upon, and deemed accepted by, the terms of this Agreement, includingNWMI Sellers or Valley Seller, as applicable, unless the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide NWMI Sellers’ Representative or Valley Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, notifies Holdco in writing prior to the expiration of the thirty (30) day period, Review Period of written notice any dispute or objection to Buyer of its acceptance of the NWMI Closing Statement or the Valley Closing Statement. Any Notice of Disagreement delivered pursuant , respectively (any such written dispute or objection being referred to this Section 1.5(a) shall specify as an “Objection”), setting forth in reasonable detail the nature basis for their dispute or objections and amount of any disagreement so asserted the specific adjustments (including dollar amounts) to the relevant Closing Statement which such Sellers believe should be made. Any items not disputed or objected to in an Objection will be deemed to have been accepted by the relevant Sellers and attach documentation supporting Seller’s calculations.
(b) the NWMI Sellers’ Representative. If a timely Notice of Disagreement is no Objections are delivered by Sellerthe NWMI Sellers’ Representative or Valley Seller to Holdco or the NWMI Sellers’ Representative or Valley Seller notifies Holdco in writing that they have no such disputes or objections to the relevant Closing Statement, in each case prior to the expiration of the Review Period, then the relevant Closing Statement (as revised in accordance with this Section 1.5(b)) will be deemed to have been accepted by, and the resulting calculation of the Cash Consideration shall become will be final and binding upon upon, Holdco and the parties on relevant Sellers and the earlier NWMI Sellers’ Representative, as applicable. For a period of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) 15 days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt an Objection to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period Holdco (or such longer period as Buyer either the objecting NWMI Sellers’ Representative or the objecting Valley Seller, as applicable, and Seller Holdco may agree in writing) (the “Resolution Period”), Buyer the objecting NWMI Sellers’ Representative or the objecting Valley Seller, as applicable, and Seller shall submit Holdco will attempt in good faith to resolve their differences, and any resolution by them as to any disputed amounts will be final, binding and conclusive. Any items agreed to by either the objecting NWMI Sellers’ Representative or the objecting Valley Seller, as applicable, and Holdco in writing, together with any items not disputed in an Objection, are collectively referred to herein as the “Resolved Matters”.
(c) If at the end of the applicable Resolution Period either the objecting NWMI Sellers’ Representative or the objecting Valley Seller, as applicable, and Holdco have been unable to resolve any differences regarding the matters specified in the Objections, the objecting NWMI Sellers’ Representative or the objecting Valley Seller, as applicable, and Holdco will refer all matters (but only such matters) which that remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “ArbiterUnresolved Matters”) for review and resolution. Buyer and Seller shall instruct to KPMG US LLP (or if such firm is unable or unwilling to accept such engagement, a nationally recognized independent public accounting firm jointly selected by the Arbiter toobjecting NWMI Sellers’ Representative or the objecting Valley Seller, as applicable, and Holdco (the Arbiter“Accounting Referee”)). The Accounting Referee will determine on a basis consistent with the requirements of this Agreement, acting and only with respect to the Unresolved Matters so submitted, whether and to what extent the NWMI Closing Statement or the Valley Closing Statement, as applicable, requires adjustment. The Accounting Referee will render its final written determination within 45 days after its engagement, which determination must be in writing and must set forth, in reasonable detail, the basis therefor.
(d) The procedures to be used by the Accounting Referee in making a determination regarding each Unresolved Matter shall be as follows: (i) within ten days after referral of the matter to and acceptance of the responsibility to resolve each Unresolved Matter by the Accounting Referee, Holdco and the objecting NWMI Sellers’ Representative or the objecting Valley Seller, as applicable, may each make a single comprehensive submission to the Accounting Referee regarding the applicable Unresolved Matters, which submission may include a copy of this Agreement and the Objection; (ii) Holdco and the objecting NWMI Sellers’ Representative or the objecting Valley Seller, as applicable, may each make a submission responding to the submission of the other described in clause (i) within ten days after receipt of such other’s submission; (iii) the Accounting Referee shall review the submissions made by Holdco and the objecting NWMI Sellers’ Representative or the objecting Valley Seller, as applicable, and may ask specific written questions of or request specific historical documents from Holdco or the objecting NWMI Sellers’ Representative or the objecting Valley Seller, as applicable, to clarify its understanding of the submissions; and (iv) copies of any submission, response or document submitted to or by the Accounting Referee by or to Holdco or the objecting NWMI Sellers’ Representative or the objecting Valley Seller, as applicable, as contemplated in this Section 2.7(d) shall be provided by the Accounting Referee to the other parties simultaneously or as soon as received, as the case may be. In resolving each Unresolved Matter, the Accounting Referee shall: (i) act as an expert and not an arbitrator, shall make a final determination of ; (ii) be bound by the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures principles set forth in this Agreement Section 2.7; (i.e., iii) limit its review to the matters in dispute specifically set forth in the documents submitted to the Accounting Referee pursuant to this Agreement; (iv) further limit its review to whether the applicable Closing Statement contained mathematical errors and was calculated in accordance with this Agreement; and (v) not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute Unresolved Matter greater than the greatest value for such item assigned Unresolved Matter claimed by Buyer, on Holdco or the one hand, objecting NWMI Sellers’ Representative or the objecting Valley Seller, on the other handas applicable, or less than the smallest value for such item assigned Unresolved Matter claimed by Buyer, on Holdco or the one hand, objecting NWMI Sellers’ Representative or the objecting Valley Seller, on the other handas applicable. The Closing Statement Accounting Referee’s final written determination will be conclusive and binding upon the resulting calculation Parties absent manifest error. The Accounting Referee will include an allocation of the Cash Consideration shall become final fees and binding on disbursements of the parties heretoAccounting Referee among the relevant Parties, if not already mutually agreed with the objecting Sellers (via the NWMI Sellers’ Representative in the case of the NWMI Sellers) bearing a percentage of the Accounting Referee’s fees and disbursements equal to the proportion that the aggregate dollar amount of Unresolved Matters unsuccessfully disputed by ▇▇▇▇▇ and the NWMI Sellers’ Representative or Valley Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectivelyas applicable, bears to the total aggregate dollar amount actually contested of Unresolved Matters submitted by such party. For examplethe objecting NWMI Sellers’ Representative or the objecting Valley Seller, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyeras applicable, and ▇▇▇▇▇ contests only $500 all remaining fees and disbursements of the amount claimed Accounting Referee being borne by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerHoldco.
(ce) Holdco will revise the applicable Closing Statement as appropriate to reflect any Resolved Matters and the resolution of any Unresolved Matter pursuant to the provisions of this Section 2.7.
(f) If the Cash Consideration NWMI Adjustment Amount, as determined using the components thereof reflected in the NWMI Closing Statement as finally determined pursuant to the terms of this Agreement, is greater than the Estimated Cash Consideration and NWMI Adjustment Amount calculated based on the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurredPayments Schedule, within then, no later than five (5) Business Days after following the final determination of the NWMI Closing Statement becomes final and binding in accordance with the terms hereofStatement, the Company shall(i) Holdco will issue to NWMI Corbel Seller a number of newly issued Holdco Preferred Shares equal to (A) 85.86% of such difference divided by (B) $1,000, and Buyer shall (ii) Holdco will cause the Company to, make a payment Newco to the Note Escrow Account of pay to NWMI Manager Seller an amount in cash equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount 14.14% of the Adjustment Escrow Amount) such difference by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes one or more accounts designated in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount writing by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesNWMI Manager Seller. If the Estimated Cash Consideration NWMI Adjustment Amount, as determined using the components thereof reflected in the NWMI Closing Statement as finally determined pursuant to the terms of this Agreement, is greater less than the Cash ConsiderationNWMI Adjustment Amount calculated based on the Payments Schedule, within then, no later than five (5) Business Days after following the final determination of the NWMI Closing Statement becomes final Statement, (x) a number of Holdco Preferred Shares held by NWMI Corbel Seller having a liquidation preference in aggregate equal to 85.86% of such difference shall be automatically cancelled and binding in accordance with forfeited without any action on the terms hereofpart of any Party, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions and, to the Escrow Agent) to make payment to Buyer (extent necessary, Holdco shall issue a new certificate or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Considerationcertificates reflecting such issuance or cancellation and forfeiture, as applicable, and (iiy) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and NWMI Manager Seller shall cause the Escrow Agent (including by delivering joint written instructions will pay to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of Newco an amount in cash equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) 14.14% of such shortfall by wire transfer of immediately available funds for purposes to one or more accounts designated in writing by Holdco, except that Holdco may elect at its sole discretion to satisfy such amount from funds held in the NWMI Manager Escrow Account if such amount is not paid within such five Business Days. If Holdco elects to withdraw funds from the NWMI Manager Escrow Account, NWMI Manager Seller will, within five Business Days after written notice of making an offer such election, deliver to repurchase the 2026 Notes Escrow Agent, by wire transfer of immediately available funds, the amount withdrawn by the Escrow Agent and the 2025 Notes paid to Newco in accordance with the provisions of this Section 1.8; provided2.7(f).
(g) If the Valley Cash Amount, as determined using the components thereof reflected in the Valley Closing Statement as finally determined pursuant to the terms of this Agreement, is greater than the Valley Cash Amount calculated based on the Payments Schedule, then, no later than five Business Days following the final determination of the Valley Closing Statement, Holdco will cause Newco to pay to Valley Seller an amount in cash equal to such difference by wire transfer of immediately available funds to one or more accounts designated in writing by Valley Seller. If the Valley Cash Amount, as determined using the components thereof reflected in the Valley Closing Statement as finally determined pursuant to the terms of this Agreement, is less than the Valley Cash Amount calculated based on the Payments Schedule, then, no later than five Business Days following the final determination of the Valley Closing Statement, Valley Seller will pay to Newco an amount in cash equal to such shortfall by wire transfer of immediately available funds to one or more accounts designated in writing by Holdco, except that Holdco may elect at its sole discretion to satisfy such amount from funds held in the Valley Escrow Account if such amount is not paid within such five Business Days. If Holdco elects to withdraw funds from the Fundamental Change Repurchase Date has occurredValley Escrow Account, Valley Seller will, within five Business Days after written notice of such election, deliver to the Escrow Agent, by wire transfer of immediately available funds, the remaining Adjustment amount withdrawn by the Escrow Funds shall instead be released Agent and paid to Seller (and held Newco in a deposit account subject to a control agreement in favor accordance with the provisions of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesthis Section 2.7(g).
Appears in 1 contract
Sources: Transaction Agreement (Great Elm Capital Group, Inc.)
Post-Closing Adjustment. (a) Within ninety Not less than ten (9010) days following Business Days prior to the Closing Date, Buyer shall, or Seller shall cause the Company to, prepare and deliver to Seller a statement Buyer its good faith estimate of the prorations and adjustments to be made with respect to the Purchase Price calculated in accordance with Section 2.5 hereof, including all estimated accrued liabilities and the deposits and prepaid expenses allocated in accordance with Section 2.5(a) (the “Closing Preliminary Adjustment Statement”). Seller shall, upon delivery of such Preliminary Adjustment Statement, permit Buyer and its representatives reasonable access to the accounting records and accountant work papers (if any) setting forth its calculation used in connection with the preparation of the Cash Consideration and each of the components thereofPreliminary Adjustment Statement. The Closing Preliminary Adjustment Statement shall be prepared in good faith in accordance with the terms of this Agreementgenerally accepted accounting principles, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the consistently applied.
(b) Within thirty (30) days immediately following Seller’s receipt after the Closing Date, Seller shall prepare and deliver to Buyer an itemized list of the final prorations and adjustments calculated in accordance with Section 2.5 (the “Closing Adjustment Statement”). The Closing Adjustment Statement shall include a description of the net amount payable by Buyer or Seller as an adjustment pursuant to Section 2.5 hereof (the “Closing Adjustment Amount”). The Closing Adjustment Statement shall be prepared in accordance with generally accepted accounting principles, consistently applied. Seller shall, upon delivery of such Closing Adjustment Statement, permit Buyer and its representatives reasonable access to the accounting records and accountant work papers (if any) used in connection with the preparation of the Closing Adjustment Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto .
(c) Within thirty (30) days following Seller’s receipt thereof unless after the date the Closing Adjustment Statement is delivered to Buyer, Buyer shall complete its examination of the Closing Adjustment Statement and shall deliver to Seller delivers either (i) the written notice acknowledgement of its disagreement (a “Notice acceptance of Disagreement”) to Buyer prior to such date; provided that the Closing Adjustment Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s deliveryClosing Adjustment Amount, prior or (ii) a written report setting forth any proposed adjustments to the expiration of Closing Adjustment Statement and the Closing Adjustment Amount (the “Adjustment Report”). In the event Buyer, within such thirty (30) day period, of written notice fails to Buyer of its acceptance of deliver an Adjustment Report, the Closing Statement. Any Notice Adjustment Statement shall be deemed to be correct and the Closing Adjustment Amount to have been finally determined for purposes of Disagreement delivered pursuant to this Section 1.5(a2.6(e) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationshereof.
(bd) If a timely Notice In the event Seller and Buyer fail to agree on any or all of Disagreement is delivered by Seller, then the proposed adjustments to the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified Adjustment Amount contained in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the Adjustment Report within thirty (30) days immediately following after Buyer receives the delivery of a Notice of Disagreement or such longer period as Buyer and Seller Adjustment Report, then any party hereto may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to retain a nationally-recognized independent certified public accounting firm that is as may be mutually selected agreed upon by ▇▇▇▇▇ the parties of the need for its services as an independent auditor and not for Seller or Buyer (the “ArbiterIndependent Auditor”). The Independent Auditor shall be instructed to make the final determination with respect to the correctness of the Adjustment Report in accordance with the terms and provisions of this Agreement within thirty (30) days after the submission thereof. The decision by the Independent Auditor as to the adjustments that should be made to the Closing Adjustment Statement (the “Final Adjustment”) for review shall be final and resolutionbinding on Seller and Buyer. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then share equally the costs and expenses of the Arbiter will be allocated 60% (i.e.Independent Auditor but each party hereto shall bear its own legal and other expenses, 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Asset Purchase Agreement (Equity Media Holdings CORP)
Post-Closing Adjustment. (a) Within ninety fifteen (9015) days following after the Closing Date(as defined below), Buyer shall, or the Shareholder Representative shall cause prepare a balance sheet of the Company to, prepare and deliver to Seller a statement at the close of business on the Closing Date (the “"Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereofDate Balance Sheet"). The Closing Statement Date Balance Sheet shall be prepared in good faith accordance with generally accepted accounting principles consistently applied in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records past practices of the Company and its Subsidiaries("GAAP"). During the thirty Within such fifteen (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (3015) day period, of written notice to Buyer of its acceptance the Shareholder Representative shall promptly deliver a copy of the Closing Statement. Any Notice of Disagreement delivered pursuant Date Balance Sheet to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsBuyer.
(b) If Buyer does not object to the Closing Date Balance Sheet within fifteen (15) days of receipt thereof, then in the event the Company has made a timely Notice of Disagreement is delivered by SellerDistribution as reflected on the Closing Date Balance Sheet, then the Closing Statement (as revised in accordance with this Section 1.5(b)) Buyer shall so notify the Escrow Agent and the resulting calculation of the Cash Consideration Escrow Holder shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified pay to Buyer an amount in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised cash equal to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller Distribution (the “Arbiter”"Purchase Price Reduction") for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerEscrow Agreement.
(c) If Buyer objects to the Cash Consideration is greater than Closing Date Balance Sheet, it shall notify the Estimated Cash Consideration Shareholder Representative within fifteen (15) days following receipt thereof, setting forth in specific detail the basis for its objection and its proposal for any adjustments thereto. Buyer and the Fundamental Change Repurchase Date Shareholder Representative shall use their best efforts to reach agreement as to any such proposed adjustment or that no such adjustment is necessary. If agreement is reached as to any proposed adjustment, the parties shall make such adjustment and the Purchase Price Reduction shall be based thereon. If Buyer and the Shareholder Representative are unable to reach agreement within thirty (30) days, then Ernst & Young LLP or such other accounting firm as such term is defined in agreed upon by Buyer and the Senior Secured Notes IndentureShareholder Representative (the "Third Party Accounting Firm") shall be engaged to review the proposed adjustment as to which agreement has not yet occurred, within five (5) Business Days after been reached and shall make a determination as to the Closing Statement becomes final and binding resolution of the proposed adjustment to cause the Purchase Price Reduction to have been properly calculated in accordance with the terms hereof, provisions of this Agreement. All resolutions shall represent either agreement with the Company shall, and position taken by Buyer shall cause or the Company to, make Shareholder Representative or a payment to the Note Escrow Account compromise of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount such positions. The determination of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes Third Party Accounting Firm shall be final, conclusive and binding upon Buyer and the 2025 Notes in accordance with Section 1.8; provided, that if Shareholders. Buyer and the Fundamental Change Repurchase Date has occurred, Shareholders shall share equally the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount costs of the Adjustment Escrow AmountThird Party Accounting Firm hereunder. Any amounts owed to Buyer as a result of these adjustments (i.e., a Distribution) shall instead will be paid to Seller (and held in a deposit account subject to a control agreement in favor by the Escrow Holder after the determination of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements Third Party Accounting Firm as set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow AccountAgreement.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety (90) 60 days following the Closing Date, Buyer shall, or Purchaser shall cause the Company to, prepare and deliver to Seller a statement of Working Capital (the “Closing "Working Capital Statement”"). Purchaser and its auditors will:
(i) make available to Seller and its agents, attorneys and accountants upon reasonable advance notice all records and workpapers reasonably necessary to understand the Working Capital Statement and to calculate Working Capital and
(ii) allow Seller and its agents, attorneys and accountants upon reasonable advance notice to interview all personnel and independent auditors involved in the preparation of the Working Capital Statement. If Seller disagrees with the computation of Working Capital contained in the Working Capital Statement, Seller may, within 30 days after receipt of the Working Capital Statement, deliver a notice (the "Objection Notice") to Purchaser setting forth its calculation Seller's objections and Seller's determination of Working Capital, to the Cash Consideration and each extent reasonably possible. At the time of the components thereof. The Closing Statement delivery of Seller's Objection Notice, if any, Seller shall be prepared in good faith in accordance with the terms of this Agreement, includingpay to Purchaser or Purchaser shall pay to Seller, as applicable, any net amount not disputed by Seller's Objection Notice. If no Objection Notice is received by Purchaser within such 30 day period, then the Accounting PrinciplesWorking Capital Statement shall be deemed to have been accepted by Seller, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty hereto. Purchaser and Seller will use reasonable efforts to resolve any disagreements as to the computation of Working Capital, but if they do not obtain a final resolution within 15 days after Purchaser has received the Objection Notice, Purchaser and Seller will jointly retain an independent accounting firm of recognized national standing that is not a public accountant of Purchaser, Prandium, Seller or any of their respective affiliates (30an "Independent Firm") to resolve any remaining disagreements. If Purchaser and Seller are unable to agree on the choice of an Independent Firm, the choice will be selected by lot from those "big-four" accounting firms that are Independent Firms or, if no "big-four" accounting firm is an Independent Firm or is willing to serve, selected by lot from those Independent Firms that are willing to serve. Purchaser and Seller will direct the retained Independent Firm to render a determination within 30 days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “retention and Purchaser and Seller and their respective agents will cooperate with the chosen Independent Firm during its engagement. The retained Independent Firm will consider only those issues related to the determination of Working Capital set forth in the Objection Notice of Disagreement”) which Purchaser and Seller have been unable to Buyer prior to such date; provided that the Closing Statement and the resulting calculation resolve. The determination of the Cash Consideration shall become final retained Independent Firm will be based on and consistent with the definition of Working Capital included herein. The determination of the chosen Independent Firm will be conclusive and binding upon Purchaser and Seller. In resolving any disagreement described above in this Section 2.3, all costs and expenses of the parties upon Seller’s delivery, prior chosen Independent Firm shall be borne by Purchaser in the proportion that the aggregate dollar amount of the disputed items submitted to the expiration of Independent Firm that are successfully disputed by Seller (as determined by the thirty (30Independent Firm) day period, of written notice bears to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and aggregate dollar amount of any disagreement all the disputed items that are so asserted submitted (whether successfully or unsuccessfully disputed by Seller); Seller shall bear all other such costs and attach documentation supporting Seller’s calculationsexpenses.
(b) If the Working Capital exceeds $(13,530,000) ("Base Working Capital") by more than $75,000, Purchaser shall pay to Seller within 5 business days of the final determination of Working Capital the amount of such excess (together with interest at the Applicable Rate as provided below), which shall be payable in cash by wire transfer or delivery of other immediately available funds. If Working Capital is less than Base Working Capital by more than $75,000, Seller shall pay to Purchaser within 5 business days of the final determina tion of Working Capital the amount of such deficit (together with interest at the rate of 10% per annum calculated on the basis of a timely Notice 360-day year and compounded daily (the "Applicable Rate")), which shall be payable in cash by wire transfer or delivery of Disagreement is delivered by Seller, then other immediately available funds. Interest at the Applicable Rate shall be paid from the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) Date to the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have payment with respect to any matter specified in the Notice of Disagreement, adjustment amount due and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter payable pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellersubsection.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety sixty (9060) days following the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement (e-mail sufficient with confirmation of delivery and receipt by Seller) setting forth, as of 12:01 a.m. on the “Closing Date, Buyer's determination of the actual amounts of Net Working Capital and each component thereof in the format provided in the Net Working Capital Calculation Schedule (the "Proposed Final Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement"), including, as applicable, the Accounting Principles, and based upon the books and records of Seller related to the Company Rehabilitation Business and its Subsidiariesin accordance with ▇▇▇▇▇▇'s historical accounting principles and practices as if the Proposed Final Closing Statement was prepared as of a fiscal year end. During Unless Buyer timely delivers to Seller the thirty (30) days immediately following Seller’s receipt of the Proposed Final Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Estimated Closing Statement and the resulting calculation of the Cash Consideration shall become final will be final, conclusive and binding upon on the parties hereto Parties, absent fraud or manifest error.
(b) Seller shall have thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice ▇▇▇▇▇'s delivery of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Proposed Final Closing Statement to review the amounts and calculations set forth on the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the Proposed Final Closing Statement. Unless within such thirty (30) day period, of Seller delivers to Buyer a written notice to Buyer (e-mail sufficient with confirmation of its acceptance of delivery and receipt by Buyer) (a "Dispute Notice"), then the Proposed Final Closing StatementStatement will be final, conclusive and binding on the Parties, absent fraud or manifest error. Any Dispute Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify hereunder must set forth in reasonable detail (i) any item on the nature Proposed Final Closing Statement that Seller disputes, the basis for such dispute, and the Seller's proposed amount of any disagreement so asserted such item and attach documentation supporting (ii) the Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting 's alternative calculation of the Cash Consideration shall become final actual amounts of Net Working Capital. Any item or amount to which no dispute is raised in the Dispute Notice will be final, conclusive and binding upon the parties on the earlier of (i) parties, absent fraud, on the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by on which ▇▇▇▇▇ and Seller and (ii) receives the date any and Dispute Notice. Any Dispute Notice must specify, with reasonable particularity, all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm facts that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on form the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other handdisagreements. The Closing Statement and Parties shall attempt to promptly resolve the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination matters raised in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerany Dispute Notice in good faith.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date Parties fail to agree to a resolution within fifteen (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (515) Business Days after delivery of any Dispute Notice, then either Buyer or Seller may provide written notice to the Closing Statement becomes final and binding other (the "Dispute Submission Notice") that it elects to submit the disputed items to RSM US LLP (the "Accounting Firm"). The Accounting Firm will promptly after receipt of the Dispute Submission Notice, in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount Commercial Arbitration Rules of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer American Arbitration Association, review only those unresolved items and amounts specifically set forth and objected to repurchase in the 2026 Notes Dispute Notice and resolve the 2025 Notes dispute with respect to each such specific unresolved item and amount in accordance with Section 1.8; providedthis Agreement (including, that if for the Fundamental Change Repurchase Date has occurredavoidance of doubt, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount extent relevant the application of the Adjustment Escrow Amount) shall instead be paid to Seller (accounting methods, practices, principles, policies and held procedures, with consistent classifications, judgments and valuation and estimation and accrual methodologies that were used in a deposit account subject to a control agreement in favor the preparation of the Consenting Noteholders) for Financial Statements by determining whether the sole purpose position of complying with mandatory repurchase requirements Buyer or Seller, are, on the whole, more accurate and, based on such determination, adopting either all of the positions set forth by Buyer or all of the positions set forth by Seller). In any such case, a single partner of the Accounting Firm selected by such Accounting Firm in the Senior Secured Notes Supplemental Indenture accordance with its normal procedures and having expertise with respect to any remaining 2025 Notes. If settlement of such disputes shall act for the Estimated Cash Consideration is greater than Accounting Firm in the Cash Considerationdetermination proceeding, and the parties shall instruct the Accounting Firm to render a written decision with respect to such disputed matter, including a statement in reasonable detail of the basis for its decision within five thirty (530) Business Days days after the parties' delivery of the disputed items. All the fees and expenses of the Accounting Firm shall be borne by Seller (in the event that ▇▇▇▇▇'s positions are adopted by the Accounting Firm) or Buyer (in the event that Seller positions are adopted by the Accounting Firm).
(d) The decision of the Accounting Firm with respect to the disputed items of the Proposed Final Closing Statement becomes final submitted to it will be final, conclusive and binding in accordance with on the terms hereofParties, Buyer absent fraud. As used herein, the Proposed Final Closing Statement or any statement that becomes binding upon a lapse of time and without timely submission to arbitration or notification of a dispute as adjusted to reflect any changes agreed to by the Parties and the Seller shall cause decision of the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow FundsAccounting Firm, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to this Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer 2.03, is referred to repurchase herein as the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes."
Appears in 1 contract
Sources: Asset Purchase Agreement (Salona Global Medical Device Corp)
Post-Closing Adjustment. (a) Within ninety As promptly as practicable after the Closing Date (90but in no event more than sixty (60) days following after the Closing Date), Buyer shall, or the Purchaser at its expense shall cause the Company to, prepare and deliver to Seller the Sellers a statement balance sheet of the Subject Company as of the close of business on the Closing Date (the “"Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereofBalance Sheet"). The Closing Statement shall Balance Sheet will be prepared in good faith in accordance with GAAP, applied on a basis consistent with the terms of this Agreement, including, as applicable, the Accounting Principles, Balance Sheet. The Sellers and the books Sellers' Accountant will be entitled to access to all relevant records and records working papers of the Subject Company to aid in the review of the Closing Balance Sheet. The Sellers will be solely responsible for all costs of the Sellers' Accountant. The Closing Balance Sheet shall be deemed to be accepted by and its Subsidiaries. During shall be conclusive for the purposes of the adjustment described in Section 2.5(b) hereof with respect to the Sellers except to the extent, if any, that the Sellers shall have delivered, within thirty (30) days immediately following Seller’s receipt after the date on which the Closing Balance Sheet is delivered to the Sellers (which period shall be tolled and extended in the event the Sellers do not receive timely all such applicable relevant records and working papers requested of the Closing StatementSubject Company by the Sellers), the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant Purchaser stating each and every item to this Section 1.5(a) shall specify which the Sellers take exception as not being in accordance with GAAP applied on a basis consistent with the Balance Sheet or as having computational errors, specifying in reasonable detail the nature and amount extent of any disagreement so asserted such exception (it being understood that any amounts not disputed shall be paid promptly). If a change proposed by the Sellers is disputed by the Purchaser then the Purchaser and attach documentation supporting Seller’s calculationsthe Sellers shall negotiate in good faith to resolve such dispute. If, after a period of twenty (20) days following the date on which the Sellers give the Purchaser notice of any such proposed change, any such proposed change still remains disputed, then the Purchaser and the Sellers shall together choose an independent firm of public accountants of nationally recognized standing (the "Accounting Firm") to resolve any remaining disputes. The Accounting Firm shall act as an arbitrator to determine, based solely on presentations by the Sellers and the Purchaser and not by independent review, only those issues still in dispute. The decision of the Accounting Firm shall be final and binding and shall be in accordance with the provisions of this Section 2.5(a). All of the fees and expenses of the Accounting Firm, if any, shall be paid by the Purchaser and the Sellers in the proportions that the Accounting Firm's determination of Shareholders' Equity Deficiency bears to the Shareholders' Equity Deficiency proposals submitted by the parties to the Accounting Firm; provided, however, that, if the Accounting Firm determines that either party's position is totally correct, then the other party shall pay one hundred percent (100%) of the costs and expenses incurred by the Accounting Firm in connection with any such determination.
(b) If In the event that there is a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter Shareholders' Equity Deficiency (as defined below). The Closing Statement , the Sellers shall be revised pay to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writingPurchaser, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (adjustment to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e.Consideration, not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount Shareholders Equity Deficiency. Any payments required to be made by which the Cash Consideration exceeds the Estimated Cash Consideration Sellers pursuant to this Section 2.5(b) shall be made within ten (up to an excess equal to 10) days after the amount of the Adjustment Escrow AmountShareholders' Equity Deficiency has been determined pursuant to Section 2.5(a) by wire transfer of immediately available funds for purposes of making to an offer account designated by the Purchaser.
(c) The term "Shareholders' Equity Deficiency" shall mean with respect to repurchase the 2026 Notes and Subject Company the 2025 Notes in accordance with Section 1.8; providedamount, that if the Fundamental Change Repurchase Date has occurredany, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration Shareholders' Equity is greater less than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account__________________.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Stock Purchase Agreement (Corporate Staffing Resources Inc)
Post-Closing Adjustment. (a) Within As soon as reasonably practicable, but in no event later than three (3) Business Days following the date that is ninety (90) days following after the Closing Date, Buyer shall, or Seller shall cause the Company to, prepare and deliver cause to Seller be delivered to Buyer a statement (the “Closing Statement”) setting forth forth, in reasonable detail, its calculation calculations, as of the Cash Consideration Effective Time, of (i) the amount (if any) by which Net Working Capital exceeds Target Working Capital or the amount (if any) by which Target Working Capital exceeds Net Working Capital, (ii) the amount of Closing Indebtedness, and each (iii) the amount of the components thereof. Transaction Expenses.
(b) The Closing Statement shall be prepared in good faith prepared, and all of the individual elements thereof, as applicable, used to calculate the Final Purchase Price shall be determined, in accordance with the terms of this AgreementNet Working Capital Methodology.
(c) As soon as reasonably practicable, includingand in no event more than three (3) Business Days following the date that is ninety (90) days after the Closing Date, as applicableBuyer shall prepare and cause to be delivered to Seller a statement (the “Uncollected Receivables Statement”) setting forth, in reasonable detail, the Accounting Principles, amounts of Closing Aged Receivables that have not been collected by Buyer and the books and records Company Group within ninety (90) days after the Closing Date. Buyer shall cause the Company Group to use commercially reasonable efforts to collect such Closing Aged Receivables within such ninety (90) day period; provided, however, that neither Buyer nor any member of the Company and its SubsidiariesGroup shall be required to commence any Legal Proceeding with respect to any Closing Aged Receivables. During For purposes of matching collected amounts to the thirty (30) days immediately following Seller’s receipt of appropriate invoices within the Closing StatementAged Receivables, the Parties agree that when a relevant customer indicates that it is paying a specific invoice, then the Parties shall accept that indication in determining which outstanding invoices have been collected. Otherwise, Buyer shall cause the Company Group to use commercially reasonable efforts, including through reasonably inquiry with the relevant customer, to identify the appropriate invoice to which a payment is intended to be applied, provided that, if, following such efforts, the Company shall provide Seller Group is unable to identify the appropriate invoice, Buyer and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of Group shall allocate all collected amounts from relevant customers to satisfy the oldest undisputed invoices within the Closing StatementAged Receivables first before satisfying newer invoiced amounts (i.e., “first-in, first-out”). The Closing Statement and the resulting calculation 3 Exhibit 10.96
(d) Following receipt of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting Uncollected Receivables Statement, each of Buyer and Seller, as applicable, and its accountants (subject to reasonable confidentiality and privilege restrictions) shall be permitted during the succeeding thirty (30)-day period (the “Review Period”) reasonable access during regular business hours to Seller’s or Buyer’s (as applicable) relevant employees and outside accountants, and any documents, schedules or workpapers used by Seller or Buyer in the preparation of the Closing Statement or the Uncollected Receivables Statement, respectively.
(e) If Buyer disagrees with the calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s deliveryNet Working Capital, Closing Indebtedness or Transaction Expenses, on or prior to the expiration last day of the thirty (30) day periodReview Period, Buyer shall notify Seller in writing of written notice to Buyer of its acceptance of such disagreement with the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration Net Working Capital, Closing Indebtedness or Transaction Expenses, which notice shall become final and binding upon set forth any such disagreement in reasonable detail, the parties on specific item of the earlier of (i) the date any and all matters specified calculation in the Net Working Capital, Closing Indebtedness or Transaction Expenses to which such disagreement relates and the specific (and reasonable) basis for each such disagreement (the “Buyer Objection Notice”). If Buyer fails to deliver the Buyer Objection Notice within the Review Period, Seller’s calculation of Disagreement are finally resolved in writing by ▇▇▇▇▇ the Net Working Capital, Closing Indebtedness and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved Transaction Expenses shall be deemed to have been accepted by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ for all purposes hereunder and Seller, on used in computing the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration Final Purchase Price and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.Post-
Appears in 1 contract
Sources: Purchase Agreement
Post-Closing Adjustment. (a) Within ninety (90) days following after the Closing Date, Buyer shall, shall deliver (or shall cause to be delivered) to the Company to, prepare and deliver to Seller Sellers a statement (the “Closing Statement”) setting forth its calculation ), together with reasonable supporting documentation of the Cash Consideration calculations contained therein, of (i) the True-Up Amount and each of component thereof and (ii) based on the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicableforegoing, the Accounting PrinciplesPurchase Price. Buyer shall not amend, and supplement or modify the books and records of the Company and Statement following its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, delivery to the books and records of the Company for purposes of their review of the Closing Statement. Sellers.
(b) The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon all of the parties hereto thirty at 5:00 p.m. in New York, New York on the forty-fifth (3045th) day following the date on which the Statement was timely delivered by Buyer to the Sellers within the applicable number of days following Seller’s receipt thereof as set forth in Section 2.4(a), unless Seller delivers the Sellers deliver written notice of its their disagreement with the Statement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statementtime. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) asserted. If a timely Notice of Disagreement is delivered received by SellerBuyer in a timely manner, then the Closing Statement (as revised in accordance with this Section 1.5(b2.4(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties Sellers and Buyer on the earlier of (i) the date the Sellers and Buyer resolve in writing any and all differences they have with respect to the matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) if any differences remain that the Sellers and Buyer are unable to resolve following the fourteen (14)-day period referred to below, the date any and all such remaining disputed matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5Independent Accountant. During the thirty fourteen (30) days immediately 14)-day period following the delivery of a Notice of Disagreement or such longer period as Disagreement, the Sellers and Buyer and Seller may agree shall seek in writing, Buyer and Seller may attempt good faith to resolve in writing any differences which that they may have with respect to any matter the matters specified in the Notice of Disagreement. If at the end of such fourteen (14)-day period the Sellers and Buyer have not resolved in writing the matters specified in the Notice of Disagreement, then, no later than ten (10) days following such fourteen (14)-day period, the Sellers and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ Buyer shall submit to the Independent Accountant for resolution, in accordance with the standards set forth in this Section 2.4, only matters that remain in dispute. The Sellers and Seller) Buyer shall be governed by Rule 408 of use reasonable efforts to cause the Federal Rules of Evidence and any applicable similar Law. At Independent Accountant to render a written decision resolving the end of such matters submitted to the Independent Accountant within thirty (30) day period (or days of the receipt of such longer period as Buyer submission. The scope of the disputes to be resolved by the Independent Accountant shall be limited to fixing mathematical errors and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain determining whether the items in dispute and which were properly included determined in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolutionaccordance with this Agreement. Buyer and Seller The Independent Accountant’s decision shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) be based solely on written submissions by ▇▇▇▇▇ the Sellers and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller their respective Representatives and not by independent review and, absent fraud, intentional misconduct or manifest error, shall cooperate with be final and binding on all of the Arbiter during the term of its engagementparties hereto. Buyer and Seller shall instruct the Arbiter The Independent Accountant may not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned claimed by Buyer, on the one hand, either party or Seller, on the other hand, or less smaller than the smallest value for such item assigned claimed by Buyer, on either party. Judgment may be entered upon the one hand, or Seller, on determination of the other handIndependent Accountant in any court having jurisdiction over the party against which such determination is to be enforced. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties heretofees, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees costs and expenses of the Arbiter Independent Accountant and the American Arbitration Association, if applicable, incurred pursuant to this Section 1.5(b) 2.4 shall be borne by pro rata as between the CompanySellers, on the one hand, and SellerBuyer, on the other hand, based upon in proportion to the percentage which the aggregate portion final allocation made by such Independent Accountant of the contested amount not awarded to Buyer and Seller, respectively, bears disputed items weighted in relation to the aggregate amount actually contested claims made by the Sellers and Buyer, such partythat the prevailing party pays the lesser proportion of such fees, costs and expenses. For example, if Seller Buyer claims that the Cash Consideration is appropriate adjustments are, in the aggregate, $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, Sellers and if the Arbiter Independent Accountant ultimately resolves the dispute by awarding Seller to Buyer an aggregate of $300 of the $500 1,000 contested, then the fees, costs and expenses of the Arbiter Independent Accountant and the American Arbitration Association, if applicable, will be allocated 6030% (i.e., 300 ÷ 5001,000) to the Company Sellers and 4070% (i.e., 200 700 ÷ 5001,000) to SellerBuyer.
(c) If As used herein, “Final True-Up Amount” means (i) if the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make Sellers fail to deliver a payment to the Note Escrow Account Notice of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes Disagreement in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred2.4(b), the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements True-Up Amount as set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If Statement or (ii) if the Estimated Cash Consideration True-Up Amount is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, resolved by Buyer and the Seller shall cause the Escrow Agent (including Sellers and/or by delivering joint written instructions submission of any disputes to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount Independent Accountant, as contemplated by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred2.4(b), the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesTrue-Up Amount as so resolved.
Appears in 1 contract
Sources: Securities Purchase Agreement (Martin Marietta Materials Inc)
Post-Closing Adjustment. (a) Within ninety (90) days following [***] after the Closing Date, Buyer shall, or shall cause the Company to, Purchasers will prepare and deliver to the Seller a statement Representative (with contemporaneous delivery to the Escrow Agent if either of the Purchasers claim that it is entitled to payment pursuant to Section 2.4(f)) written notice (the “Adjustment Notice”) containing (i) an unaudited consolidated balance sheet of the Acquired Companies as of the close of business on the Closing Date (the “Closing StatementBalance Sheet”), (ii) setting forth its the Purchasers’ calculation of the Cash Consideration [***] based on the Closing Balance Sheet (the [***]) and each (iii) the Purchasers’ calculation of the components thereofamount of any payments [***] = Confidential Treatment requested for redacted portion; redacted portion has been filed separately with the Commission. required pursuant to Section 2.4(f) (the “Adjustment Calculation”). The Closing Statement shall Balance Sheet will be prepared in good faith in accordance with GAAP in a manner consistent with the terms methods and practices used to prepare the Interim Balance Sheet. For the purpose of this Agreement, including, as applicablethe Sellers’ review of the Adjustment Notice, the Accounting Principles, Company shall provide and the Purchasers shall allow the Company to provide the Sellers (y) access to all books and records of the Company and its Subsidiaries. During Acquired Companies relevant to the thirty (30) days immediately following Seller’s receipt Sellers for the purpose of the Closing Statement, the Company shall provide Seller and its representatives with reasonable accessthis Section 2.4, during normal business hours and after reasonable advance noticeat the place where the same are normally kept, with full right to make copies thereof or take extracts therefrom and, further, (z) with such information as the Sellers and their accountant shall reasonably require. The information so made available to the books Sellers shall be subject to a duty of confidentiality except for disclosures necessary for resolving any disputed item or otherwise required by applicable Law or securities Laws, rules and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsregulations.
(b) If a timely Notice Within [***] after delivery of Disagreement the Adjustment Notice, the Seller Representative will deliver to the Purchasers (with contemporaneous delivery to the Escrow Agent if either of the Purchasers claim that it is delivered by Seller, then the Closing Statement (as revised in accordance with this entitled to payment pursuant to Section 1.5(b2.4(f)) and a written response in which the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of Seller Representative will either:
(i) the date any and all matters specified in the Notice of Disagreement are finally resolved agree in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth Adjustment Calculation, in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for which case such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become will be final and binding on the parties hereto, if not already mutually agreed for purposes of Section 2.4(f); or
(ii) dispute the Adjustment Calculation by ▇▇▇▇▇ and Seller, on delivering to the date Purchasers a written notice (a “Dispute Notice”) setting forth in reasonable detail the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of basis for each such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Selleritem.
(c) If the Cash Consideration is greater than Seller Representative fails to take either of the Estimated Cash Consideration and foregoing actions within [***] after delivery of the Fundamental Change Repurchase Date (as such term is defined Adjustment Notice, then the Sellers will be deemed to have irrevocably accepted the Adjustment Calculation, in which case, the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes Adjustment Calculation will be final and binding on the parties for purposes of Section 2.4(f).
(d) If the Seller Representative timely delivers a Dispute Notice to the Purchasers (with contemporaneous delivery to the Escrow Agent if either of the Purchasers claim that it is entitled to payment pursuant to Section 2.4(f)), then the Purchasers and the Seller Representative will attempt in accordance good faith, for a period of [***], to agree on the Adjustment Calculation for purposes of Section 2.4(f). Any resolution by the Purchasers and the Seller Representative during such [***] period as to any disputed items will be final and binding on the parties for purposes of Section 2.4(f). If the Purchasers and the Seller Representative do not resolve all disputed items by the end of [***] after the date of delivery of the Dispute Notice, then the Purchasers and the Seller Representative will submit the remaining items in dispute to PricewaterhouseCoopers LLP for resolution, or if that firm is unwilling or unable to serve, the Purchasers and the Seller Representative will engage another mutually agreeable independent accounting firm of recognized international standing, which firm is not the regular auditing firm of the Purchasers or the Acquired Companies (such selected independent accounting firm, the “Independent Accounting Firm”). The Purchasers and the Seller Representative will instruct the Independent Accounting Firm to render its determination with respect to the items in dispute in a written report that specifies the conclusions of the Independent Accounting Firm as to each item in dispute and the resulting Adjustment Calculation. The Purchasers and the Seller Representative will each use their commercially reasonable efforts to cause the Independent Accounting Firm to render its determination within [***] after referral of the items to such firm or as soon thereafter as reasonably practicable. The Independent Accounting Firm’s determination of the Adjustment Calculation as set forth in its report will be final and binding on the parties for purposes of Section 2.4(f). [***]
(e) For purposes of complying with this Section 2.4, the Purchasers and the Seller Representative will furnish to each other and to the Independent Accounting Firm such work papers and [***] = Confidential Treatment requested for redacted portion; redacted portion has been filed separately with the terms hereofCommission. other documents and information relating to the disputed issues as the Independent Accounting Firm may request and are available to that party (or its independent public accountants) and will be afforded the opportunity to present to the Independent Accounting Firm any material related to the disputed items and to discuss the items with the Independent Accounting Firm. The Purchasers may require that the Independent Accounting Firm enter into a customary form of confidentiality agreement with respect to the work papers and other documents and information regarding the Acquired Companies provided to the Independent Accounting Firm pursuant to this Section 2.4.
(f) If the [***] as finally determined pursuant to this Section 2.4 is [***], then the Company shallSellers will pay to the Purchasers the amount of such difference in cash plus Interest thereon from the Closing Date through and including the date of such payment. [***]. If the [***] as finally determined pursuant to this Section 2.4 is [***], and Buyer shall cause then the Company to, make a Purchasers will have no obligation to pay any such difference to the Sellers.
(g) Any payment to the Note Purchasers pursuant Section 2.4(f) will first be satisfied by payment from the Escrow Account of an amount equal to the Fund. The Sellers will be jointly and severally liable for any amount by which the Cash Consideration any payment required under Section 2.4(f) exceeds the Estimated Cash Consideration (up to an excess equal to the amount then balance of the Adjustment Escrow Amount) Fund, together with Interest from the Closing Date through and including the date of such payment, which payment will be effected by wire transfer of immediately available funds for purposes from the Sellers to an account or accounts designated by the Purchasers. Such payments will be made within five business days following the final determination of making an offer to repurchase the 2026 Notes and the 2025 Notes [***] in accordance with this Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account2.4.
(dh) Within five (5) Business Days after Any payment made pursuant to this Section 2.4 will be treated by the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (parties for all purposes as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions an adjustment to the Escrow Agent) Initial Purchase Price and will not be subject to make a offset for any reason. The payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c2.4(f) (if any) will be applied in proportion to the Initial Purchase Price to be received by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to each Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements as set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.on Schedule A and Schedule B.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety (90) 60 days following the Closing DateClosing, Buyer TPI shall, or shall cause the Company toat its expense and with cooperation from Newco's employees and access to Newco's books and records, prepare or cause to be prepared, and deliver to Seller PCA and Newco a statement (the “"Closing Working Capital Statement”") setting which shall set forth its calculation the Net Working Capital of the Cash Consideration and each Containerboard Business as of the components thereofDetermination Date (the "Closing Working Capital") and as of the date of the Most Recent Statement of Assets and Liabilities. The amounts so computed shall be used to determine the amount of the payment between TPI and Newco in accordance with this Section 2.5 (the "Post Closing Adjustment"). The Closing Working Capital Statement shall be prepared using the same principles, practices and procedures that were used in good faith in accordance with preparing the terms Most Recent Statement of this Agreement, including, as applicableAssets and Liabilities. Notwithstanding the foregoing, the Accounting Principlesfollowing paragraphs (i) through (viii) shall take precedence over such principles, practices and procedures in the preparation of the Closing Working Capital Statement:
(i) The Current Assets included in the Closing Working Capital Statement will be adjusted to exclude the Retained Assets, the LIFO reserve and any current assets related to Tenneco defined benefit pension plans and shall not be taken into account in computing the Post Closing Adjustment.
(ii) The Current Liabilities included in the Closing Working Capital Statement will be adjusted to exclude the Retained Liabilities. Any current liabilities related to Tenneco's defined benefit pension plans shall not be taken into account in computing the Post Closing Adjustment.
(iii) The Most Recent Statement of Assets and Liabilities does not, and the books and records Closing Working Capital Statement will not, include any accrual or deferral related to federal, state, local or foreign income Taxes.
(iv) The Closing Working Capital Statement shall not include any dollar amounts related to the Existing Financing Arrangements.
(v) The Closing Working Capital Statement shall not include any dollar amounts related to the New Financing Arrangements. No Post Closing Adjustment shall result from the purchase during the period from the date of the Company Most Recent Statement of Assets and its Subsidiaries. During Liabilities to the thirty (30) days immediately following Seller’s receipt Determination Date of any assets which were leased at the date of the Most Recent Statement of Assets and Liabilities.
(vi) The Closing Statement, Working Capital Statement shall not include any liabilities related to bonuses or incentive compensation earned in 1998.
(vii) Any change in accounting principles after the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records date of the Company for purposes Most Recent Statement of their review of Assets and Liabilities (including any changes required by GAAP) will not apply in determining the Closing Working Capital Statement. .
(viii) The Closing Working Capital Statement and shall exclude any increase or decrease in Current Assets or Current Liabilities resulting directly from accounting for the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsTransaction.
(b) If a timely Notice PCA and PCA's accountants and Newco and Newco's accountants shall have 30 days after the delivery by TPI of Disagreement is delivered by Seller, then the Closing Working Capital Statement to review the Closing Working Capital Statement. In the event that PCA or Newco determines that the Closing Working Capital as derived from the Closing Working Capital Statement has not been determined on the basis set forth herein, PCA or Newco shall inform TPI in writing (the "Objection"), setting forth a specific description of the basis of the Objection and the adjustments to the Closing Working Capital which PCA or Newco believes should be made, which Objection must be delivered to TPI on or before the last day of such 30-day period. TPI shall then have 30 days to review and respond to the Objection. TPI and PCA and Newco shall attempt in good faith to reach an agreement with respect to any matters in dispute. If TPI and PCA and Newco are unable to resolve all of their disagreements with respect to the determination of the foregoing items within 45 days following the delivery of Objection, they shall refer their remaining differences to a "Big Five" firm of independent public accountants as revised to which TPI and PCA and Newco mutually agree (the "CPA Firm"), who shall, acting as experts and not as arbitrators, determine in accordance with this Section 1.5(b)) Agreement, and only with respect to the resulting calculation of remaining differences so submitted, whether and to what extent, if any, the Cash Consideration Closing Working Capital as derived from the Closing Working Capital Statement requires adjustment. TPI and PCA and Newco shall become final direct the CPA Firm to use its best efforts to render its determination within 30 days after such submission. The CPA Firm's determination shall be conclusive and binding upon ▇▇▇▇▇, ▇▇▇ ▇▇▇ TPI. The fees and disbursements of the parties on CPA Firm shall be paid by Newco. PCA, Newco and TPI shall make readily available to the earlier CPA Firm all relevant books and records and any work papers (including those of the parties' respective accountants) relating to the Closing Working Capital Statement and all other items reasonably requested by the CPA Firm. The "Final Working Capital Statement" shall be (i) the date any and all matters specified Closing Working Capital Statement in the Notice of Disagreement are finally resolved in writing event that no Objection is delivered by ▇▇▇▇▇ and Seller and PCA or Newco during the 30-day period specified above, or (ii) the date any and all matters specified in the Notice of Disagreement not resolved Closing Working Capital Statement, as adjusted by Buyer and Seller are finally resolved in writing by the Arbiter either (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (iix) the Adjustment Escrow Fundsagreement of TPI, in each case, from PCA and Newco or (y) the Adjustment Escrow AccountCPA Firm.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety (90) days following the Closing DateSeller has prepared a proforma unaudited balance sheet as of February 28, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement 2001 (the “Closing StatementBaseline Balance Sheet Date”), which is attached hereto as part of Schedule 3.1(d) setting (the “Baseline Balance Sheet”), in accordance with GAAP and on a basis consistent with that of the audited balance sheet of the Seller as of December 31, 2000, attached hereto as part of Schedule 3.1(d). In addition, Schedule 2.2 sets forth its Seller’s and Buyer’s calculation of the Cash Consideration and each of the components thereofnet liabilities assumed. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more Not later than thirty (30) days following submission after the Closing Date, Seller shall prepare in accordance with GAAP on a basis consistent with the Baseline Balance Sheet (provided that Accounts Receivable shall exclude items over 120 days) a balance sheet of such disputed mattersthe Seller as of the Closing Date (the “Closing Date Balance Sheet”), as well as a revised calculation of the net liabilities assumed based on the Closing Date Balance Sheet and prepared on a basis consistent with Schedule 2.2, both of which shall be delivered to Buyer. In the event of a dispute between Buyer and Seller involving the Closing Date Balance Sheet, Buyer and Seller shall attempt to reconcile their differences, and any resolution by them as to any disputed amounts shall be final, binding and conclusive on the parties hereto. If Buyer and Seller are unable to resolve the dispute, Buyer and Seller shall promptly jointly engage a mutually agreeable independent accounting firm to determine and report to Buyer and Seller upon such final determination by the Arbiter shall not be subject to court review or otherwise appealableremaining disputed items. The fees and expenses disbursements of the Arbiter pursuant to this Section 1.5(b) accounting firm shall be borne by allocated equally between the Company, on Buyer and the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion . The determination of the contested amount not awarded to accounting firm shall be final and binding upon Buyer and Seller. Following delivery of the Closing Date Balance Sheet and the revised calculation of the net liabilities assumed, respectivelythe Purchase Price shall be adjusted as follows:
(a) if there is a decrease in the net liabilities assumed (excluding any reduction in the deferred revenue amount and any increase in capitalized software costs), bears to the aggregate Purchase Price will be increased by the amount actually contested by such party. For exampleof decrease, if Seller claims the Cash Consideration absolute value of the decrease is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 5% of the amount claimed by Seller, and if net liabilities assumed as set forth on Schedule 2.2. If the Arbiter ultimately resolves the dispute by awarding Seller $300 absolute value of the $500 contesteddecrease in the net liabilities assumed is less than or equal to 5% of the net liabilities assumed as set forth on Schedule 2.2, then the costs and expenses of the Arbiter there will be allocated 60% (i.e., 300 ÷ 500) to no increase in the Company and 40% (i.e., 200 ÷ 500) to SellerPurchase Price.
(cb) If if there is an increase in the Cash Consideration net liabilities assumed, the Purchase Price will be decreased by the amount of increase, if the increase is greater than 5% of the Estimated Cash Consideration and net liabilities assumed as set forth on Schedule 2.2. If the Fundamental Change Repurchase Date (as such term is defined increase in the Senior Secured Notes Indenture) has not yet occurrednet liabilities assumed is less than or equal to 5% of the net liabilities assumed as set forth on Schedule 2.2, within five (5) Business Days after then there will be no decrease in the Closing Statement becomes final and binding in accordance with Purchase Price. All amounts payable by the terms hereof, the Company shall, and Buyer shall cause the Company to, make Seller as a payment result of any adjustments to the Note Escrow Account Purchase Price shall be payable first out of an amount equal the Holdback Amount. Any and all amounts payable by the Buyer as a result of any adjustments to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) Purchase Price shall be payable by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal Seller’s Account pursuant to the amount wire instructions delivered prior to Closing. Any amounts payable to either party hereto shall be paid within three Business Days of the Adjustment Escrow Amountdetermination of such amounts pursuant to subsections (a) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (iib) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Accountabove.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Asset Purchase Agreement (Aros Corp)
Post-Closing Adjustment. (a) Within ninety one hundred and eighty (90180) days following the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller Sellers’ Representative a statement (the “Closing Statement”) setting forth its calculation of the Closing Cash Consideration and each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and except as otherwise contemplated by the books and records definitions of the Company and its SubsidiariesNet Working Capital, Indebtedness or Cash. During the thirty sixty (3060) days immediately following SellerSellers’ Representative’s receipt of the Closing Statement, the Company shall provide Seller and its representatives Sellers’ Representative with reasonable access, during normal business hours and after reasonable advance notice, to the books books, records and records appropriate personnel of the Company Company, and to the Buyer and its accountants, for purposes of their review of the Closing StatementStatement on behalf of the Sellers. The Closing Statement and the resulting calculation of the Closing Cash Consideration shall become final and binding upon the parties hereto thirty sixty (3060) days following SellerSellers’ Representative’s receipt thereof unless Seller Seller’s Representative delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Closing Cash Consideration shall become final and binding upon the parties upon SellerSellers’ Representative’s delivery, prior to the expiration of the thirty sixty (3060) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting SellerSellers’ Representative’s calculations.
(b) If a timely Notice of Disagreement is delivered by SellerSellers’ Representative, then the Closing Statement (as revised in accordance with this Section 1.5(b1.4(b)) and the resulting calculation of the Closing Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ Buyer and Seller Sellers’ Representative, and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller Sellers’ Representative are finally resolved in writing by the Arbiter (as defined below)) in accordance with this Section 1.4. The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ Buyer and Seller or Sellers’ Representative and any final resolution determined by the Arbiter in accordance with this Section 1.51.4. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller Sellers’ Representative may agree in writing, Buyer and Seller may attempt Sellers’ Representative shall seek in good faith to resolve in writing any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto shall (unless otherwise agreed by ▇▇▇▇▇ Buyer and SellerSellers’ Representative) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Lawstate rule. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing)period, Buyer and Seller Sellers’ Representative shall have thirty (30) days to submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ Person which the Buyer and Seller shall mutually agree shall be the arbiter (the “Arbiter”) for review and resolution. Buyer and Seller Sellers’ Representative shall use such thirty (30) day submission period to submit documentation to the Arbiter supporting their respective positions regarding the disputed matters submitted to the Arbiter. Buyer and Sellers’ Representative shall instruct the Arbiter to, and the ArbiterArbiter shall, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review)Agreement. Buyer and Seller Sellers’ Representative shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller Sellers’ Representative shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or SellerSellers’ Representative, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or SellerSellers’ Representative, on the other hand. Buyer and Sellers’ Representative shall also instruct the Arbiter to, and the Arbiter shall, make its determination based solely on presentations by Buyer and Sellers’ Representative that are in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). The Closing Statement and the resulting calculation of the Closing Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ Buyer and SellerSellers’ Representative, on the date the Arbiter delivers its final determination in writing to Buyer and Seller Sellers’ Representative (which final determination shall be requested by ▇▇▇▇▇ Buyer and Seller Sellers’ Representative to be delivered not more than thirty (30) days following submission of such disputed matters, submitted not later than the end of the 30-day submission period referenced above in this Section 1.4(b)), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b1.4(b) shall be borne by the Company, on the one hand, and SellerSellers’ Representative, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, each party bears to the aggregate amount actually contested by such partycontested. For example, if Seller Sellers’ Representative claims the Closing Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ Buyer contests only $500 of the amount claimed by SellerSellers’ Representative, and if the Arbiter ultimately resolves the dispute by awarding Seller Sellers’ Representative $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerSellers’ Representative.
(c) If the Closing Cash Consideration in the Closing Statement delivered in accordance with Section 1.4(a) is greater than the Estimated Closing Cash Consideration and a Notice of Disagreement is not delivered in timely fashion pursuant to said Section 1.4(a), then the Company shall pay the difference between the Estimated Closing Cash Consideration and the Fundamental Change Repurchase Date Closing Statement to Sellers by wire transfer of immediately available funds to the account(s) previously designated by Sellers five (5) Business Days after Buyer delivers the Closing Statement, which will be provided to Sellers not later than thirty (30) days after completion of the opening balance audit of the consolidated balance sheet as such term of July 31, 2015. If a Notice of Disagreement is defined in the Senior Secured Notes Indenturetimely delivered pursuant to Section 1.4(a) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount Sellers equal to the amount by which the Closing Cash Consideration exceeds the Estimated Closing Cash Consideration (up to an excess equal to as provided in the amount of the Adjustment Escrow Amount) Closing Statement by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of account(s) previously designated by Sellers at the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of time the Consenting Noteholders) for Buyer delivers the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesClosing Statement. If the Estimated Closing Cash Consideration is greater than the Closing Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller Sellers shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Closing Cash Consideration exceeds the Closing Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) Consideration by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8account(s) designated by Buyer; provided, however, that if Buyer, in its sole discretion, may elect to be paid such amount from the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth as defined in the Senior Secured Notes Supplemental Indenture with respect Escrow Agreement) in the Escrow Account (as defined in the Escrow Agreement), in which case Andatha shall deliver any instruction or other documentation required by the Escrow Agent to any remaining 2025 Notespermit such payment to Buyer (or its designees).
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety (90) days following Promptly after the Closing Date, Buyer shall, or Seller shall cause to be prepared and delivered to Restoration statements of operations, changes in shareholder's equity and cash flow and a balance sheet of the Company toas of and for the fiscal year ended January 31, prepare and deliver to Seller a statement 1998 (the “Closing Statement”"Year-End Financial Statements") setting forth its calculation and a balance sheet of the Cash Consideration and Company as of March 20, 1998 (the "Closing Balance Sheet"), in each of the components thereof. The Closing Statement shall be prepared in good faith case in accordance with GAAP applied on a basis consistent with the terms of this Agreement, including, as applicable, Financial Statements for the Accounting Principles, Company referred to in Section 3.04. The Year-End Financial Statements shall be audited and the books Closing Balance Sheet shall be reviewed by Deloitte & Touche LLP ("Deloitte"), independent accountants for Restoration, to confirm that such Year-End Financial Statements and records the Closing Balance Sheet have been prepared in accordance with GAAP and fairly present the financial position of the Company as of such dates and its Subsidiariesresults of operations and cash flows for such periods. During the thirty (30) days immediately following Seller’s receipt Restoration shall deliver copies of the audited Year-End Financial Statements and the reviewed Closing Statement, the Company shall provide Balance Sheet to Seller and its representatives with reasonable accessSeller's independent accountants, during normal business hours and ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇ ("▇▇▇▇▇▇"), not later than 45 days after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing StatementDate. The Closing Statement Seller shall cooperate and the resulting calculation of the Cash Consideration shall become final cause its accountants to cooperate with Restoration and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to auditors in connection with such date; provided that the Closing Statement audit and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsreview.
(b) Within 7 days after its receipt of the audited Year-End Financial Statements and the Closing Balance Sheet, Seller shall advise Restoration whether Seller has any exceptions to such audited Year-End Financial Statements, the Closing Balance Sheet or the conduct of the audit. Unless Seller shall deliver to Restoration within such 7-day period a letter of Seller specifying in reasonable detail any such exceptions, the Net Worth shall be conclusive and binding on Seller and Restoration and shall provide the basis for the adjustment specified in subsection (c) below. If within such 7-day period Seller shall deliver to Restoration a timely Notice letter of Disagreement is delivered Seller setting forth any such exceptions which, in the aggregate, would result in a material adjustment in the Closing Balance Sheet, Seller -------- and Restoration shall promptly endeavor to resolve the matters set forth in such letter; and if Seller and Restoration shall fail to reach an agreement with respect to such matters on or before the 14th day after receipt by SellerRestoration of such Seller letter, then the Closing Statement (Seller and Restoration shall engage a third firm of independent public accountants of recognized national standing who shall promptly make an independent determination of such matters as revised in accordance with this Section 1.5(b)) to which disagreement remains and the resulting calculation shall deliver its written opinion thereon to Seller and Restoration. The opinion of the Cash Consideration such third firm shall become final be conclusive and binding upon on Seller and Restoration and shall provide the parties on basis for the earlier of (i) the date any and all matters adjustment specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and subsection (iic) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have below with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and remaining disagreement between Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerRestoration.
(c) If the Cash Consideration is greater Net Worth shall be less than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred$1,450,000, Seller shall pay, within five (5) Business Days 5 days after the date on which the Closing Statement becomes final Balance Sheet shall become conclusive and binding in accordance with the terms hereofsubsection (b) above, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of Restoration an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes difference between $1,450,000 and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notessuch Net Worth. If the Estimated Cash Consideration is Net Worth shall be greater than the Cash Consideration$1,450,000, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller there shall cause the Escrow Agent (including be no further action or payment by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Accounteither party.
(d) Within five (5One half of the fees and disbursements of Deloitte incurred in connection with the audit described in Section 2.04(a) Business Days after shall be paid by Restoration. The remaining half of the Deloitte fees and disbursements to a maximum amount of $30,000 shall be paid by Seller. The fees incurred by ▇▇▇▇▇▇ as they relate to helping the Company maintain and close its books at February 1, 1997, December 31, 1997, January 31, 1998 and as of the Closing Statement becomes final Date shall be borne by the Company up to maximum of $30,000. All additional costs in excess of the aforementioned $30,000 related to maintaining and binding in accordance with closing the terms hereof Company's books at February 1, 1997, December 31, 1997, January 31, 1997 and if as of the Fundamental Change Repurchase Closing Date (as and all costs relating to ▇▇▇▇▇▇'▇ review of the audited Year-End Financial Statements and the Closing Balance Sheet shall be borne by Seller. The fees and disbursements of such term is defined in the Senior Secured Notes Indenture) has not yet occurredthird firm, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) , shall be equally shared by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes Seller and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesRestoration.
Appears in 1 contract
Sources: Stock Purchase Agreement (Restoration Hardware Inc)
Post-Closing Adjustment. (a) Within As promptly as practicable after the Closing, but in any event within ninety (90) days following after the Closing DateClosing, Buyer shall, or shall cause the Company to, Purchaser will prepare and deliver to Seller a statement based on the Carve-Out Accounting Principles (the “Post-Closing Statement”) setting forth its in reasonable detail Purchaser’s calculation of (i) the Cash Consideration Closing Net Working Capital and each the NWC Adjustment, (ii) the Closing Cash, (iii) the Closing Indebtedness, (iv) the Acquired Companies Transaction Expenses and (v) the proposed Final Purchase Price.
(b) Seller may, within forty-five (45) days after delivery of the components thereof. The Post-Closing Statement (the “Seller Notice Period”), deliver a notice to Purchaser disagreeing with specific items in the Post-Closing Statement and setting forth in reasonable detail Seller’s calculation of (i) the Closing Net Working Capital and the NWC Adjustment, (ii) the Closing Cash, (iii) the Closing Indebtedness and (iv) the Acquired Companies Transaction Expenses, together with supporting documentation and work papers describing in reasonable detail how such specific items were derived (the “Notice of Disagreement”). If Seller does not deliver the Notice of Disagreement within the Seller Notice Period, then Seller will be deemed to have agreed to the Post-Closing Statement and the computation of the Purchase Price set forth therein will be final, conclusive and binding on the parties for all purposes hereunder. If Seller delivers the Notice of Disagreement within the Seller Notice Period, Seller shall be prepared deemed to have agreed with all amounts and items contained or reflected in good faith the Post-Closing Statement to the extent such amounts or items are not disputed in accordance with the terms Notice of this AgreementDisagreement and all such undisputed amounts will be final, includingconclusive and binding on the parties for all purposes hereunder.
(c) If Seller delivers the Notice of Disagreement within the Seller Notice Period, as applicablePurchaser and Seller, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During during the thirty (30) days immediately following Seller’s receipt such delivery, will cooperate and discuss in good faith to reach agreement on the disputed items or amounts in order to determine the Final Purchase Price. If the parties so resolve all disputes, the computation of the Closing StatementPurchase Price agreed upon by the parties, will be final, conclusive and binding on the parties for all purposes hereunder.
(d) If Seller delivers a Notice of Disagreement within the Seller Notice Period, and Purchaser and Seller are unable to reach an agreement on the disputed items or amounts within the period described in Section 1.6(c), the Company shall provide parties will engage Deloitte or another mutually agreed independent accountant to be agreed upon by Purchaser and Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice(the “Independent Accountant”), to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement this Agreement and the resulting disputed items or amounts for the purpose of calculating the Final Purchase Price (it being understood that, in making such calculation, the Independent Accountant will function as an expert and not as an arbitrator). In making its calculation of the Cash Consideration shall become final and binding upon Final Purchase Price, the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of Independent Accountant (i) will apply the date any accounting and all matters specified related standards contemplated in this Agreement including the definitions of “Closing Net Working Capital,” “NWC Adjustment,” “Closing Cash,” “Closing Indebtedness” and “Acquired Companies Transaction Expenses” in this Agreement, (ii) will consider only those items or amounts in the Post-Closing Statement as to which Seller identifies in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (iiiii) the date any and all matters specified in the Notice of Disagreement will not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, Purchaser or Seller, on the other hand, Seller or less than the smallest value for such item assigned by BuyerPurchaser or Seller in the Post-Closing Statement or the Notice of Disagreement, on the one hand, or as applicable. The Independent Accountant will deliver to Purchaser and Seller, on as promptly as practicable (but in any event within thirty (30) days after the other hand. The Closing Statement and date of engagement of the resulting Independent Accountant), a report setting forth its calculation of the Cash Consideration shall become final Final Purchase Price. The Independent Accountant’s calculation of the Final Purchase Price will be final, conclusive and binding on the parties heretofor all purposes hereunder. Subject to the following sentence, if not already mutually agreed by ▇▇▇▇▇ and Sellerthe costs of any dispute resolution pursuant to this subsection, on including the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) Independent Accountant and of any enforcement of the determination thereof, shall be borne by the Company, Purchaser and Seller in inverse proportion as they may prevail on the one handmatters resolved by the Independent Accountant, and Seller, which proportionate allocation shall be calculated on an aggregate basis based on the other hand, based upon the percentage which the aggregate portion relative Dollar values of the contested amount not awarded to Buyer amounts in dispute and Sellershall be determined by the Independent Accountant at the time the determination of such firm is rendered on the merits of the matters submitted. Notwithstanding the foregoing, respectivelythe fees and disbursements of the Representatives of each party incurred in connection with their preparation or review of the Post-Closing Statement and preparation or review of any Notice of Disagreement, bears to the aggregate amount actually contested as applicable, shall be borne by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(e) The final, conclusive and binding Purchase Price as determined in accordance with Section 1.6(b), (c) and (d), will be referred to as the “Final Purchase Price.”
(f) If the Cash Consideration Final Purchase Price is greater than the Estimated Cash Consideration Purchase Price, Purchaser (or one or more Purchaser Designees) will promptly, and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within no event later than five (5) Business Days after determination of the Closing Statement becomes final and binding Final Purchase Price in accordance with the terms hereofthis Section 1.6, the Company shall, and Buyer shall cause the Company to, make a payment pay to the Note Escrow Account of Seller an aggregate amount equal to the amount by which the Cash Consideration exceeds Final Purchase Price less the Estimated Cash Consideration Purchase Price, by one (up to an excess equal to the amount of the Adjustment Escrow Amount1) by or more wire transfer transfers of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and Seller Account. Notwithstanding anything to the 2025 Notes in accordance with Section 1.8; providedcontrary contained herein, that if such payment shall be made directly from Purchaser to Seller.
(g) If the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds Final Purchase Price is less than the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Purchase Price, Seller (will promptly, and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater no event later than the Cash Consideration, within five (5) Business Days after determination of the Closing Statement becomes final and binding Final Purchase Price in accordance with the terms hereofthis Section 1.6, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions pay to the Escrow Agent) to make payment to Buyer Purchaser (or its designeesone or more Purchaser Designees) of an aggregate amount equal to the lesser of Estimated Purchase Price less the Final Purchase Price, by one (i1) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by or more wire transfer transfers of immediately available funds for purposes of making to an offer account specified by Purchaser. Notwithstanding anything to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; providedcontrary contained herein, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds such payment shall instead be released made directly from Seller to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesPurchaser.
Appears in 1 contract
Sources: Purchase Agreement (Nn Inc)
Post-Closing Adjustment. (a) Within ninety (90) Notwithstanding anything to the contrary contained herein, as soon as practicable and in any event no later than 45 days following after the Closing, the Beneficiaries shall deliver to Buyer an unaudited balance sheet and statements of operation and cash flows for the Company as of and for the period April 1, 2000 through the time on the Closing DateDate immediately prior to the Closing, Buyer shallbut after giving effect to the third sentence of Section 1.2 (collectively, or shall cause the Company to, prepare and deliver to Seller a statement (the “"Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereofDate Financials"). The Closing Statement Date Financials shall be prepared in good faith in accordance with generally accepted accounting principles and on the terms of this Agreement, including, same basis as applicable, the Accounting PrinciplesCompany's other financial statements set forth on SCHEDULE 3.8 hereto, and the books include all normal and records recurring adjustments necessary for a fair presentation of the Company and its Subsidiariesinformation set forth therein. During the thirty (30) 45 days immediately following Seller’s receipt of after the Closing StatementClosing, Buyer shall grant the Company shall provide Seller and its representatives with Beneficiaries reasonable access, during normal business hours and after reasonable advance notice, access to the books and records of the Company for purposes solely to the extent that such access is necessary to prepare the Closing Date Financials. As soon as is reasonably practicable, but in any event no later than the later of their 75 days following the Closing Date and 30 days following receipt of the Closing Date Financials from the Beneficiaries, Buyer shall complete a review of the Closing StatementDate Financials and shall inform the Beneficiaries in writing that the Closing Date Financials are acceptable or object to the Closing Date Financials in writing, setting forth a specific description of Buyer's objections. If Buyer does not so object to the Closing Date Financials within such period, then Buyer will be deemed to have accepted the Closing Date Financials. If Buyer so objects to the Closing Date Financials and the Beneficiaries do not agree with Buyer's objections or such objections are not resolved on a mutually agreeable basis within 15 days of the Beneficiaries' receipt of Buyer's objections, any such disagreements shall be promptly submitted by either party to a mutually agreeable independent certified accounting firm (the "Independent Firm"). The Closing Statement and the resulting calculation Independent Firm shall resolve such dispute within 30 days after submission of the Cash Consideration dispute by the parties. The decision of the Independent Firm shall become be final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of Beneficiaries and Buyer and its disagreement (a “Notice of Disagreement”) to Buyer prior to fees, costs and expenses shall be borne by the party against which the Independent Firm shall rule or proportioned as deemed appropriate by such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsIndependent Firm.
(b) If a timely Notice Subject to the proviso in the last sentence of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b1.3(b)) and , the resulting calculation of Purchase Price shall be adjusted upward or downward, on a dollar-for-dollar basis, by the Cash Consideration shall become final and binding upon the parties amount that Equity as shown on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items balance sheet included in the Closing Statement Date Financials, as finally determined (to the extent such amounts are in dispute"Closing Balance Sheet") based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with is less negative or more negative than the guidelines and procedures Equity amount of negative $2,900,000 set forth in this Agreement (i.e.Section 1.2 above. "Equity" is defined as total assets minus total liabilities, not calculated using GAAP. In the event that Equity is more negative than negative $2,900,000 on the basis of an independent review). Closing Balance Sheet, the Trust or the Beneficiaries shall pay to Buyer and Seller shall cooperate with (in the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation case of the Cash Consideration shall become final and binding on the parties heretoBeneficiaries, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination pro rata in writing proportion to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses each Beneficiary's proportionate share of the Arbiter pursuant to this Section 1.5(bPurchase Price) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion in cash within 10 business days of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 acceptance of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to Balance Sheet the amount of such downward adjustment. In the Adjustment Escrow Amountevent that Equity is less negative than negative $2,900,000 on the Closing Balance Sheet, Buyer shall pay to the Beneficiaries (pro rata in proportion to each Beneficiary's proportionate share of the Purchase Price) by wire transfer in cash within 10 business days of immediately available funds for purposes the acceptance of making an offer to repurchase the 2026 Notes and Closing Balance Sheet the 2025 Notes in accordance with Section 1.8amount of such upward adjustment; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; providedhowever, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds in no event shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notessuch upward adjustment exceed $500,000.
Appears in 1 contract
Post-Closing Adjustment. (ai) Within As soon as practicable, but no later than ninety (90) days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller Sellers a statement setting forth its calculation of Closing Working Capital (as measured against Target Working Capital), Indebtedness, Transaction Expenses, and the resulting calculation of the Closing Consideration, calculated in a manner consistent with the account categories used in the Estimated Closing Statement, which statement shall also contain a balance sheet of the Business as of the Effective Time (without giving effect to the transactions contemplated herein) (the “Closing Statement”) setting forth its calculation ), together with reasonable supporting documentation and a certificate of the Cash Consideration and each Chief Financial Officer of Buyer that the components thereof. The Closing Statement shall be was prepared in good faith and in accordance with GAAP applied using the terms of this Agreementsame accounting methods, includingpractices, as applicableprinciples, policies and procedures, in all material respects, with consistent classifications, judgments and estimation methodologies that were used in the Accounting Principles, and the books and records preparation of the Company and its Subsidiaries. During Annual Financial Statements for the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the most recent fiscal year end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts the same are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines GAAP) as if such accounts were being prepared and procedures set forth in this Agreement audited as of a fiscal year end.
(i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. ii) The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination post-closing adjustment shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested an amount not awarded to Buyer and Seller, respectively, bears equal to the aggregate Closing Consideration (as adjusted pursuant to the Closing Statement) minus the Estimated Closing Consideration (the “Post-Closing Adjustment”). If the Post-Closing Adjustment is a positive number, Buyer shall pay to Sellers an amount actually contested by such partyequal to the Post-Closing Adjustment. For exampleIf the Post-Closing Adjustment is a negative number, if Seller claims Sellers shall pay to Buyer an amount equal to the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 Post-Closing Adjustment. Any payment of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will Post-Closing Adjustment shall (A) be allocated 60% due either (i.e., 300 ÷ 500x) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after of acceptance of the applicable Closing Statement becomes final and binding in accordance with the terms hereofor (y) if there are Disputed Amounts, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration then within five (up to an excess equal to the amount 5) Business Days of the Adjustment Escrow Amountresolution described in Section 2.06(c)(v) below; and (B) be paid by wire transfer of immediately available funds for purposes of making an offer to repurchase such account as is directed by Buyer or Sellers, as the 2026 Notes and the 2025 Notes in accordance with Section 1.8case may be; provided, that if the Fundamental Change Repurchase Date has occurred, the amount any Post-Closing Adjustment not paid by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, Sellers within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause be paid by wire transfer of immediately available funds by the Escrow Agent (including by delivering joint written instructions to from the Escrow Agent) Amount. If the Post-Closing Adjustment to make payment to Buyer be paid by the Sellers exceeds the Escrow Amount, the Sellers shall pay (or its designees) of an amount equal cause to the lesser of (ibe paid) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within such excess to Buyer not later than five (5) Business Days after final determination of the Post-Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to this Section 1.5(c) (if any) 2.06, by wire transfer of immediately available funds for purposes to an account specified by Buyer. Buyer and Seller shall promptly deliver joint written instructions to the Escrow Agent instructing the Escrow Agent to deliver the applicable amounts due to the Buyer pursuant to this Section 2.03(b)(iii). Sellers shall promptly, and in any event within ten (10) Business Days, deposit with the Escrow Agent the amount of making an offer any Post-Closing Adjustment paid to repurchase Buyer from the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesAmount.
Appears in 1 contract
Post-Closing Adjustment. (ai) Within ninety forty-five (9045) days following after the Closing DateDate (the “45-Day Period”), Buyer shall, or Purchaser shall cause the Company to, prepare and deliver to the Seller Representative a statement (the “Closing Purchase Price Statement”) setting forth its Purchaser’s calculation of the Cash Consideration actual Closing Purchase Price and each all components thereof, which shall include (a) the Closing Book Value as of the components thereofReference Time without giving effect to any of the transactions contemplated by this Agreement (such amount as determined pursuant to this Section 2.03, the “Final Closing Book Value”) and the resulting Closing Book Value Shortage (if any), and (b) the Company Expenses as of immediately prior to Closing (such amount as determined pursuant to this Section 2.03, the “Final Company Expenses”), in each case, as determined in accordance with the Accounting Principles, together with reasonably detailed related supporting schedules, calculations and documentation. The Closing Purchase Price Statement shall be prepared in good faith accordance 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 the most recent fiscal year end. If Purchaser does not deliver the Closing Purchase Price Statement to the Seller Representative within the 45-Day Period, at the election of the Seller Representative, (x) Purchaser will be deemed to have waived the right to object to any items set forth in the Estimated Purchase Price Statement and all such items will be deemed to be Final for purposes of determining the Post-Closing Adjustment, as described below in this Section 2.03, or (y) the Seller Representative may prepare and deliver to Purchaser, no later than fifteen (15) days after the 45-Day Period, the Closing Purchase Price Statement (as prepared by Seller, the “Seller Closing Purchase Price Statement”). The Seller Representative will include in the Seller Closing Purchase Price Statement materials showing in reasonable detail the Seller Representative’s support and calculations for the amounts included in the Seller Closing Purchase Price Statement. The Seller Closing Purchase Price Statement shall be prepared in accordance with the terms of this Agreementsame accounting methods, includingpractices, as applicableprinciples, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the Accounting Principles, and the books and records preparation of the Company and its Subsidiaries. During Annual Financial Statements for the thirty most recent fiscal year end.
(30ii) days immediately following Seller’s receipt of In the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided event that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered Purchase Price as Finally determined pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration 2.03 is greater than the Estimated Cash Consideration Purchase Price, then Purchaser and the Fundamental Change Repurchase Date Seller Representative shall direct the Escrow Agent to pay to the Seller Representative the entirety of the Escrow Amount and Purchaser shall pay to the Seller Representative an amount equal to such excess, if any. If the Closing Purchase Price as Finally determined pursuant to this Section 2.03 is equal to or less than the Estimated Purchase Price, then Purchaser and the Seller Representative shall direct the Escrow Agent to pay to Purchaser the amount of such difference (as such term difference, the “Return Amount”), up to the amount of the Escrow Amount, and, simultaneously, to pay to the Seller Representative the remaining balance, if any, of the Escrow Amount after payment of the Return Amount. If the Escrow Amount is defined less than the amount due by Sellers under this Section 2.03 (such amount, the “Purchase Price Overage”), each Seller shall pay to Purchaser, by wire transfer of immediately available funds, to an account designated in writing by Purchaser, an amount equal to such Seller’s Post-Closing Percentage of the Senior Secured Notes Indenture) has not yet occurred, Purchase Price Overage within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a Days. The applicable adjusting payment to be made hereunder is the Note Escrow Account “Post-Closing Adjustment.” The Seller Representative shall promptly deliver to each Seller such Seller’s Post-Closing Percentage of an amount equal to the amount any funds received by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer Representative pursuant to this Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes2.03(b)(ii).
Appears in 1 contract
Sources: Membership Interest Purchase Agreement (Northrim Bancorp Inc)
Post-Closing Adjustment. (a) Within ninety (90) 60 days following after the Closing Date, Buyer shall, or shall cause the Company to, Moldflow will prepare and deliver to Seller a statement Husky written notice (the “"Adjustment Notice") containing (A) an unaudited balance sheet of the Business as of the close of business on the Closing Statement”Date (the "Closing Balance Sheet"), (B) setting forth its Moldflow's calculation of the Cash Consideration Net Working Capital as at the Closing Date (the "Closing Net Working Capital") determined based on the Closing Balance Sheet and each (C) Moldflow's calculation of the components thereofamount of any payment required pursuant to Section 2.6(i). The Except as set forth in Section 3.4(b) of the Seller Disclosure Schedule, the Closing Statement shall Balance Sheet will be prepared in good faith in accordance a manner consistent with the terms Interim Balance Sheet. For the purposes of this Agreement, including, as applicablevaluing all non U.S. dollar denominated assets and liabilities on the Closing Balance Sheet, the Accounting Principles, and the books and records source of exchange rates will be those found on ▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ taken as of the Company and its Subsidiaries. close of business on June 29, 2007.
(b) During the thirty (30) days immediately following Seller’s receipt period from the Closing Date until the date of delivery of the Closing StatementBalance Sheet, the Company Husky shall provide Seller give Moldflow such assistance and its representatives with reasonable access, during normal business hours and after reasonable advance notice, access to the books and records relating to the Business and comprising part of the Company Purchased Assets as Moldflow may reasonably request in order to enable it to prepare the Closing Balance Sheet.
(c) Forthwith after the Closing Date until the date of delivery of the Closing Balance Sheet, and in the event that such information is available in the sole discretion of Seller acting reasonably, Seller will use reasonable efforts to provide Buyer with preliminary drafts or portions of certain financial information (the "Preliminary Information") that will be used by Seller to prepare the Closing Balance Sheet. Any such Preliminary Information will be provided to Buyer as it becomes available on an as is basis, will not be audited, will not constitute the Closing Balance Sheet and will be in preliminary form, subject to material change. Buyer expressly agrees that Seller makes no representations and warranties about any such Preliminary Information, which shall be provided on an "as is" basis and that the use of such Preliminary Information by Buyer is at its sole risk.
(d) For the purpose of assisting and facilitating Buyer in confirming that the Closing Balance Sheet is being and will be prepared in a manner consistent with the Interim Balance Sheet (except as set forth in Section 3.4(b) of the Seller Disclosure Schedule) including the application of Seller's accounting principles, policies and practices, Moldflow will, at Buyer's request, use commercially reasonable efforts to assist Buyer and its independent accountant in carrying out the specified procedures listed in Exhibit D (the "Specified Procedures"), provided that:
(A) the covenant to assist Buyer and its independent accountant in Section 2.6(d) in no way changes the basis for the preparation of the Closing Balance Sheet set out in Sections 2.6 and 3.4(b) and does not expand or change the scope of the representation and warranty of Moldflow in Section 3.4;
(B) Moldflow shall only be obligated to provide such assistance if requests for assistance hereunder do not unduly interfere with the ordinary conduct of business by the Seller; and
(C) Moldflow shall not be responsible for the costs of Husky's independent accountant in carrying out the Specified Procedures. Notwithstanding the foregoing, nothing herein obligates Moldflow to disclose any information, records, files or other data to Buyer or its independent accountant to the extent such disclosure is prohibited by any applicable Laws or if the consent of any Person or Governmental Authority is required to permit Moldflow to release such information, records, files or data to Husky and such consent has not been obtained following commercially reasonable efforts diligently made by Moldflow to obtain it.
(e) Within 30 days after delivery of the Adjustment Notice, Husky will deliver to Moldflow a written response in which Husky will either:
(i) agree in writing with Moldflow's calculation of the Closing Net Working Capital as set forth in the Adjustment Notice, in which case such calculation of the Closing Net Working Capital will be final and binding on the parties for purposes of their review Section 2.6(i); or
(ii) dispute Moldflow's calculation of the Closing Statement. The Closing Statement and Net Working Capital as set forth in the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers Adjustment Notice by delivering to Moldflow a written notice of its disagreement (a “Notice of Disagreement”"Dispute Notice") to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify setting forth in reasonable detail the nature basis for each such disputed item and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationscertifying that all such disputed items are being disputed in good faith.
(bf) If a timely Notice Husky fails to take either of Disagreement is delivered by Sellerthe foregoing actions within 30 days after delivery of the Adjustment Notice, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting Husky will be deemed to have irrevocably accepted Moldflow's calculation of the Cash Consideration shall become Closing Net Working Capital as set forth in the Adjustment Notice, in which case, such calculation of the Closing Net Working Capital will be final and binding upon on the parties for purposes of Section 2.6(i).
(g) If Husky delivers a Dispute Notice to Moldflow within 30 days after delivery of the Adjustment Notice, then Husky and Seller will attempt in good faith, for a period of 30 days, to agree in writing on the earlier calculation of (i) the date any and all matters specified in the Notice Closing Net Working Capital for purposes of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined belowSection 2.6(i). The Closing Statement shall be revised to the extent necessary to reflect any Any resolution agreed to by ▇▇▇▇▇ Husky and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (Moldflow during such 30) days immediately following the delivery of a Notice of Disagreement or such longer -day period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in disputed items will be final and binding on the Notice Parties for purposes of Disagreement, Section 2.6(i). If Husky and Moldflow do not resolve all such discussions related thereto (unless otherwise agreed disputed items by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer 30 days after the date of delivery of the Dispute Notice, then Husky and Seller may agree in writing), Buyer and Seller shall Moldflow will submit any and all matters (but only such matters) which remain the remaining items in dispute to Deloitte & Touche USA LLP for resolution, or if that firm is unwilling or unable to serve, Husky and which were properly included in the Notice of Disagreement to a nationally-recognized Moldflow will engage another mutually agreeable independent accounting firm that of recognized national standing, which firm is mutually selected by ▇▇▇▇▇ and Seller (not the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter regular auditing firm of, or adviser to, either Husky or Moldflow and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination is otherwise independent of each of the items included in the Closing Statement (Parties. If Husky and Moldflow are unable to the extent jointly select such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e.independent accounting firm within 10 days after such 30-day period, not Husky, on the basis of one hand, and Moldflow, on the other hand, will each select an independent review). Buyer accounting firm of recognized national standing and Seller shall cooperate with each such selected accounting firm will select a third independent accounting firm of recognized national standing, which firm is not the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not regular auditing firm of, or adviser to, and the Arbiter shall noteither Husky or Moldflow; provided, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyerthat if either Husky, on the one hand, or SellerMoldflow, on the other hand, fail to select such independent accounting firm during this 10-day period, then the Parties agree that the independent accounting firm selected by the other Party is deemed to be the independent accounting firm selected by the Parties for purposes of this Section 2.6 (such selected independent accounting firm, whether pursuant to this sentence or less than the smallest value for preceding sentence, the "Independent Accounting Firm"). Husky and Moldflow will instruct the Independent Accounting Firm to render its determination with respect to the items in dispute referred to in the Dispute Notice in a written report that specifies the conclusions of the Independent Accounting Firm as to each such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement in dispute and the resulting calculation of the Cash Consideration shall become Closing Net Working Capital. Husky and Moldflow will instruct the Independent Accounting Firm to render its determination as soon as practicable after referral of the items to such firm but in any event within 30 days following such referral. The determinations of the Independent Accounting Firm with respect to the Closing Net Working Capital as set forth in its report will be final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ Parties for purposes of Section 2.6(i). Moldflow will revise the Closing Balance Sheet and Seller, on the date calculation of the Arbiter delivers its final determination Closing Net Working Capital as appropriate to reflect the resolution of the issues in writing dispute pursuant to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed mattersthis Section 2.6(g), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter Independent Accounting Firm will be shared by Husky and Moldflow in inverse proportion to the relative amounts of the disputed amount determined to be for the account of Husky and Moldflow, respectively.
(h) For purposes of complying with this Section 2.6, the Parties will furnish to each other and to the Independent Accounting Firm as soon as practicable such work papers and other documents and information relating to the disputed issues as the Independent Accounting Firm may request and are available to that Party (or its independent public accountants) and will be afforded the opportunity to present to the Independent Accounting Firm any material related to the disputed items and to discuss the items with the Independent Accounting Firm. Either Party may require that the Independent Accounting Firm enter into a customary form of confidentiality agreement with respect to the work papers and other documents and information regarding the Party provided to the Independent Accounting Firm pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller2.6.
(ci) If the Cash Consideration Closing Net Working Capital as finally determined pursuant to this Section 2.6 is less than the Interim Net Working Capital, then Moldflow will pay to Husky the amount of such difference in cash plus interest thereon (calculated based on the actual number of days elapsed in a year consisting of 365 days) from the Closing Date through and including the date of such payment at a rate of 5% per annum. If the Closing Net Working Capital as finally determined pursuant to this Section 2.6 is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurredInterim Net Working Capital, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment then Husky will pay to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to Moldflow the amount of such difference in cash plus interest thereon (calculated based on the Adjustment Escrow Amountactual number of days elapsed in a year consisting of 365 days) from the Closing Date through and including the date of such payment at a rate of 5% per annum.
(j) Any payment to Husky pursuant Section 2.6(i) will be effected by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up from Moldflow to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (account designated by Husky, and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer Moldflow pursuant to Section 1.5(c2.6(i) (if any) will be effected by wire transfer of immediately available funds for purposes to an account designated by Moldflow. Such payments will be made within five Business Days following the final determination of making an offer to repurchase the 2026 Notes and the 2025 Notes Closing Net Working Capital in accordance with this Section 1.8; provided, 2.6.
(k) The payment pursuant to Section 2.6(i) (other than the portion thereof that if is attributable to the Fundamental Change Repurchase Date has occurred, payment of interest pursuant to Section 2.6(i)) will be treated by the remaining Adjustment Escrow Funds shall instead be released Parties as an adjustment to Seller (and held the Initial Purchase Price. The Initial Purchase Price as so adjusted is referred to in a deposit account subject to a control agreement in favor of this Agreement as the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes"Purchase Price."
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Post-Closing Adjustment. (a) Within ninety (90) days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller Parent a statement (the “Closing Statement”) setting forth its in reasonable detail Buyer’s calculation of the Cash Consideration Closing Date Working Capital and each its resulting calculation of the components thereofClosing Adjustment Amount. The Closing Statement shall be prepared in good faith the format of the Form of Closing Statement using the Accounting Principles.
(b) If Seller Parent disputes the Closing Statement prepared by Buyer, Seller Parent shall deliver to Buyer within sixty (60) days after receipt of the Closing Statement a notice setting forth Seller Parent’s calculation of the Closing Date Working Capital and its resulting calculation of the Closing Adjustment Amount (which shall be calculated in accordance with Section 3.3(a)) and describing in detail the terms basis for the determination of this Agreement, including, as applicablesuch different amount (such notice, the Accounting Principles“Dispute Notice”, and each item in dispute, a “Disputed Item”). Buyer and Seller Parent shall use reasonable efforts to resolve the books and records Disputed Items for a period of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt after Seller Parent has given the Dispute Notice.
(c) If Buyer and Seller Parent have not resolved all of the Closing StatementDisputed Items (any such unresolved items, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto “Unresolved Items”) within thirty (30) days following Seller’s receipt thereof unless after Seller delivers written notice Parent has given the Dispute Notice, then, within fifteen (15) days after the expiration of its disagreement such period, Buyer and Seller Parent shall submit the Unresolved Items to a jointly appointed independent and impartial certified public accountant who is a partner at a neutral nationally recognized accounting firm in the United States that is not the auditor or independent accounting firm of, and is otherwise independent of, the Parties and any of their respective Affiliates (a the “Notice of DisagreementTransaction Arbitrator”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become for final and binding upon arbitration. If the parties upon Seller’s delivery, prior Parties are unable to timely appoint a Transaction Arbitrator within fifteen (15) days of the expiration of the thirty (30) day periodresolution period described above, either Buyer or Seller Parent may request that the American Arbitration Association appoint the Transaction Arbitrator. Buyer and Seller Parent shall each bear the respective fees and costs incurred by it and its respective Affiliates in connection with the matters set forth in this Section 3.3(c), except that the fees and disbursements of written notice the Transaction Arbitrator shall be paid by Buyer or Seller Parent in proportion to those matters submitted to the Transaction Arbitrator that are resolved against Buyer or Seller Parent, as applicable, as such fees and disbursements are allocated by the Transaction Arbitrator pursuant to the foregoing.
(d) The Transaction Arbitrator shall review and determine the Unresolved Items, and only the Unresolved Items, in a manner consistent with this Section 3.3(d) and the Accounting Principles. The review and determination shall be based solely on the grounds presented by Buyer and Seller Parent. In no event shall the Transaction Arbitrator’s determination of its acceptance an Unresolved Item be for an amount outside the ranges proposed by Buyer and Seller Parent in the Closing Statement and the Dispute Notice, respectively.
(e) Within ten (10) days after the appointment of the Transaction Arbitrator, Buyer and Seller Parent shall provide to the Transaction Arbitrator a copy of the Closing Statement. Any Notice Statement and Dispute Notice, and shall each provide to the Transaction Arbitrator, with a copy to the other Party, a written report that states for each Unresolved Item the dollar amount in dispute, a narrative description of Disagreement delivered pursuant to this Section 1.5(a) how the dollar amount was calculated or derived by such Party, if applicable, and an explanation of the rationale for such Party’s position; provided that each such report shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then be consistent with the Closing Statement (as revised in accordance with this Section 1.5(b)the case of Buyer) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of Dispute Notice (i) the date any and all matters specified in the Notice case of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent reviewParent). Buyer and Seller Parent shall reasonably cooperate with the Arbiter during Transaction Arbitrator and shall provide to the term Transaction Arbitrator and to each other, upon the request of the Transaction Arbitrator and in each case to the extent required to complete its engagement. Buyer review of the Unresolved Items, any non-privileged information and documentation, including any accountants’ work papers or internal accounting records, and make reasonably available to the Transaction Arbitrator employees of Buyer, on the one hand, and Seller Parent, on the other hand, in each case that have been involved in the preparation or review of the Closing Statement and Dispute Notice; provided, however, that the independent accountants of Seller Parent or Buyer shall instruct not be obligated to make any working papers available to the Arbiter not toTransaction Arbitrator unless and until the Transaction Arbitrator has signed a customary confidentiality and hold harmless agreement relating to such access to working papers in form and substance reasonably acceptable to such independent accountants. Neither Buyer, on the one hand, nor Seller Parent, on the other hand, shall disclose to the Transaction Arbitrator, and the Arbiter Transaction Arbitrator shall notnot consider for any purpose, assign a value to any item in dispute greater than the greatest value for such item assigned settlement discussions or settlement offer made by Buyer, on the one hand, or SellerSeller Parent, on the other hand, or less than the smallest value for such item assigned by Buyerwith respect to any objection under this Section 3.3, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually unless otherwise agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to by Buyer and Seller Parent.
(which final determination f) The place of arbitration shall be requested by ▇▇▇▇▇ New York, New York.
(g) Buyer and Seller Parent shall use their reasonable best efforts to be delivered not more than cause the Transaction Arbitrator to issue its final written award regarding the Unresolved Items within thirty (30) days following submission of after such disputed matters)items are submitted for review, and otherwise as soon as practicable. The award shall include a reasonably detailed explanation of the changes, if any, required to be made to the Closing Statement. The award shall be governed by the Federal Arbitration Act, 9 U.S.C.
§ 1. The award shall be final and binding upon the Parties and may be enforced in any court having jurisdiction; provided, however, that within seven (7) days after transmittal by the Transaction Arbitrator of the award, either Party may request in writing with a copy to the other Party, that the Transaction Arbitrator correct any clerical, typographical or computational errors in the award. The other Party shall have seven (7) days to respond and the Transaction Arbitrator shall dispose of the request within five (5) days after such seven (7) day period, after which the Closing Statement shall be revised.
(h) Each Party shall provide promptly to the other Party all non-privileged information and reasonable access to employees as such other Party shall reasonably request to the extent required to complete its review of the Closing Statement or the Dispute Notice, as the case may be, including all work papers of the accountants who audited, compiled or reviewed such statements or notices, and shall otherwise cooperate in good faith with such other Party to arrive at a final determination by of the Arbiter Closing Statement; provided, however, that the independent accountants of the non-requesting Party shall not be subject obligated to court review or otherwise appealable. make any working papers available to the requesting Party unless and until such requesting Party has signed a customary confidentiality and hold harmless agreement relating to such access to working papers in form and substance reasonably acceptable to such independent accountants.
(i) The fees Parties agree that the procedures set forth in this Section 3.3 for resolving disputes with respect to the Closing Statement shall be the sole and expenses exclusive method for resolving any such disputes, provided that this provision shall not prohibit any Party from instituting litigation to enforce the ruling of the Arbiter Transaction Arbitrator.
(j) If Buyer and Seller Parent resolve the Disputed Items during the thirty (30) day period referred to in Section 3.3(b), the Closing Adjustment Amount agreed to by the Parties shall be deemed to be the “Final Closing Adjustment Amount” and the Closing Statement agreed to by the Parties shall be deemed to be the “Final Closing Statement.” If Buyer and Seller Parent do not so resolve the Disputed Items and the Unresolved Items are submitted to the Transaction Arbitrator, the Closing Adjustment Amount determined by the Transaction Arbitrator pursuant to the terms of this Section 1.5(b) 3.3 shall be borne deemed to be the “Final Closing Adjustment Amount” and the Closing Statement so determined by the Company, on Transaction Arbitrator shall be deemed to be the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount “Final Closing Statement.” If Seller Parent does not awarded timely deliver a Dispute Notice to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs Closing Adjustment Amount proposed by Buyer in its Closing Statement shall be deemed to be the “Final Closing Adjustment Amount” and expenses of shall be conclusive and binding on the Arbiter will be allocated 60% (i.e.Parties, 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerabsent fraud or manifest error.
(ck) If the Cash Consideration Final Closing Adjustment Amount is less than the Estimated Closing Adjustment Amount, then Seller Parent shall pay to Buyer an amount equal to the difference between the Estimated Closing Adjustment Amount and the Final Closing Adjustment Amount. If the Final Closing Adjustment Amount is greater than the Estimated Cash Consideration Closing Adjustment Amount, then Buyer shall pay to Seller Parent an amount equal to the difference between the Final Closing Adjustment Amount and the Fundamental Change Repurchase Date Estimated Closing Adjustment Amount. If the Final Closing Adjustment Amount is equal to the Estimated Closing Adjustment Amount, then no payment shall be due under this Section 3.3(k). Any amounts due pursuant to this Section 3.3(k) shall be paid promptly by the relevant party (as such term is defined and in the Senior Secured Notes Indenture) has not yet occurred, any event within five (5) Business Days Days) after the Closing Statement becomes final and binding determination thereof in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) cash in U.S. Dollars by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amountaccount designated by Seller Parent or Buyer (as applicable) shall instead be paid to Seller at least two (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (52) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Accountadvance.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Purchase and Sale Agreement (Melinta Therapeutics, Inc. /New/)
Post-Closing Adjustment. (a) Within ninety (90) Promptly, but in any event within 60 days following after the Closing Date, the Buyer shall, or shall cause the Company to, (X) prepare and deliver to Seller the Sellers’ Representative a statement balance sheet of the Company (the “Closing StatementBalance Sheet”) setting forth its calculation (prepared in accordance with Exhibit A and the Accounting Principles, provided that in the event of a conflict between Exhibit A and the Accounting Principles, Exhibit A shall prevail), which will reflect in reasonable detail the Buyer’s determination of the Cash Consideration Final Net Purchase Price and each (i) the unpaid Company Transaction Expenses (which shall be included as a liability of the components thereof. The Company on the Closing Statement shall be Balance Sheet), (ii) the Working Capital Deficiency, if any, (iii) the Working Capital Surplus, if any, (iv) the Indebtedness of the Company, and (v) the Closing Cash, in each case as of the Adjustment Time, and (Y) deliver to the Sellers’ Representative the Closing Balance Sheet, together with a certificate of the Buyer executed on its behalf by its Chief Financial Officer confirming that the Closing Balance Sheet was properly prepared in good faith and in accordance with the terms of this Agreement, including, as applicable, Exhibit A and the Accounting Principles, provided that in the event of a conflict between Exhibit A and the books Accounting Principles, Exhibit A shall prevail. For the avoidance of doubt, the provisions of Exhibit A shall be interpreted so as to avoid double counting (whether positive or negative), of any item to be included in the Closing Balance Sheet, including Working Capital, Company Transaction Expenses, Closing Cash and records Indebtedness.
(b) If the Sellers’ Representative in good faith disagrees with the Buyer’s determination of the Final Net Purchase Price, the Company and its Subsidiaries. During Transaction Expenses, Working Capital Deficiency, Working Capital Surplus, Indebtedness and/or Closing Cash in each case as reflected on the thirty (30) Closing Balance Sheet, the Sellers’ Representative may, within 30 days immediately following Seller’s after receipt of the Closing StatementBalance Sheet, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers deliver a written notice of its disagreement (a the “Notice of Disagreement”) to the Buyer prior to setting forth each item of dispute (each an “Item of Dispute”), the reasonable basis for such date; provided that dispute and the Sellers’ Representative’s calculation of such Item of Dispute. If the Buyer does not receive a Notice of Disagreement within 30 days after delivery by the Buyer of the Closing Statement and Balance Sheet, the resulting calculation of the Cash Consideration Closing Balance Sheet shall become final be conclusive and binding upon the parties upon Seller’s delivery, prior to the expiration each of the thirty (30) day period, Parties. If the Buyer receives a Notice of written notice to Disagreement from the Sellers’ Representative within 30 days after delivery by the Buyer of its acceptance of the Closing Statement. Any Notice Balance Sheet, the Buyer and the Sellers’ Representative shall attempt in good faith to resolve each Item of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount Dispute, and, if any Item of any disagreement Dispute is so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Sellerresolved, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement Balance Sheet shall be revised modified to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5such resolution. During the thirty (30) days immediately following period between the Buyer’s delivery of a Notice the Closing Balance Sheet pursuant to Section 2.6(a) and the final determination of Disagreement the same pursuant to Section 2.6(b), the Buyer shall provide the Sellers’ Representative and its representatives with reasonable access to the books, records, personnel and representatives of the Company, and such other information related to the Company as the Sellers’ Representative or such longer period its representatives may reasonably request, so as Buyer to enable the Sellers’ Representative and its representatives to analyze the Closing Balance Sheet and the underlying calculations and documents related thereto. If any Item of Dispute remains unresolved as of the 30th day after timely delivery by the Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in of the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing)the Sellers’ Representative shall jointly retain an impartial, nationally recognized firm of chartered professional accountants agreeable to both the Buyer and Seller shall submit Sellers’ Representative (the “Independent Accounting Firm”) to resolve such remaining disagreement, it being understood that any and all matters (but only such matters) which remain in dispute and which were properly item not included in as an Item of Dispute on the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ shall be conclusive and Seller (binding upon each of the “Arbiter”) for review and resolutionParties as set forth on the Closing Balance Sheet. The Buyer and Seller the Sellers’ Representative shall instruct request that the Arbiter toIndependent Accounting Firm render a determination as to each unresolved Item of Dispute as soon as practicable after its retention and in no event greater than 30 days after the engagement of the Independent Accounting Firm, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination each of the items included in Buyer, the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ Sellers’ Representative and Seller each of their respective agents and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller representatives shall cooperate with the Arbiter during Independent Accounting Firm, and shall provide the term Independent Accounting Firm with reasonable access to their respective books, records, personnel and representatives and such other information as the Independent Accounting Firm may reasonably request, so as to enable it to make such determination as quickly and accurately as practicable. The Independent Accounting Firm shall consider only those Items of its engagement. Dispute and amounts related thereto that were set forth in the Closing Balance Sheet and the Notice of Disagreement and that remain unresolved by the Buyer and Seller shall instruct the Arbiter not toSellers’ Representative, and in resolving any Item of Dispute, the Arbiter shall not, Independent Accounting Firm may not assign a value to any item in dispute greater than the greatest value for such item assigned claimed by Buyer, on the one hand, or Seller, on the other hand, or either Party nor less than the smallest value for such item assigned claimed by Buyer, on the one hand, or Seller, on the other handeither Party. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(bIndependent Accounting Firm’s determination(s) shall be borne by based upon the Companydefinitions of Company Transaction Expenses, Working Capital Deficiency, Working Capital Surplus, Indebtedness and Closing Cash (as applicable) included herein and in accordance with Exhibit A and the Accounting Principles (provided that in the event of a conflict between Exhibit A and the Accounting Principles, Exhibit A shall prevail). The Independent Accounting Firm’s determination of each Item of Dispute submitted to it shall be in writing, shall conform with this Section 2.6 and, absent manifest error, shall be conclusive and binding upon each of the Parties, and the Closing Balance Sheet shall be modified to the extent necessary to reflect such determination(s). The Independent Accounting Firm shall allocate its fees, costs and expenses between the Buyer on the one hand, and Seller, the Sellers on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, each such Person bears to the aggregate amount actually contested by such partyPerson. For exampleThe Company Transaction Expenses, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by BuyerWorking Capital Deficiency, Working Capital Surplus, Indebtedness and ▇▇▇▇▇ contests only $500 of the amount claimed by SellerClosing Cash, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (in each case as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes Time and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer finally determined pursuant to this Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer 2.6, are referred to repurchase herein as the 2026 Notes “Final Company Transaction Expenses,” “Final Working Capital Deficiency,” “Final Working Capital Surplus,” “Final Indebtedness,” and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes“Final Closing Cash,” respectively.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety ten (9010) business days following after the Closing Date, Buyer shall, or Seller shall cause determine the Company to, prepare and deliver to Seller a statement amount of the Transferred Inventory Value as of the Closing Date (the “Closing StatementTransferred Inventory Value”) setting forth its calculation and deliver a statement of the Cash Consideration and each of the components thereof. The such Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, Transferred Inventory Value to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsPurchaser.
(b) If a timely Notice of Disagreement is delivered by Seller, then the The Closing Statement (as revised Transferred Inventory Value shall be determined in accordance with this Section 1.5(b)) U.S. generally accepted accounting principles applied consistently with the past practices of Seller and the resulting calculation preparation of the Cash Consideration Reference Balance Sheet. Such Closing Transferred Inventory Value shall become final and binding upon the parties on the earlier of (i) the date exclude any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised purchase price accounting adjustments Purchaser is required to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent make under U.S. generally accepted accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerprinciples.
(c) If In the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (event Purchaser does not agree as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow AmountClosing Transferred Inventory Value as determined by Seller, then Purchaser shall deliver to Seller a written statement describing with reasonable detail the basis for any such claim within fifteen (15) by wire transfer business days after receiving Seller’s statement of immediately available funds for purposes of making an offer to repurchase the 2026 Notes Closing Transferred Inventory Value and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount shall prepare its own calculation of the Adjustment Escrow Amount) shall instead be paid Closing Transferred Inventory Value. Purchaser and Seller will then use reasonable efforts to Seller (and held in a deposit account subject to a control agreement in favor of resolve any such claims on the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesClosing Transferred Inventory Value themselves. If the Estimated Cash Consideration is greater than the Cash Consideration, they do not obtain a final resolution within forty-five (545) Business Days business days after the Closing Statement becomes final Date, however, Purchaser and binding in accordance with Seller will select an accounting firm from among the terms hereof, Buyer “Final Four” accounting firms mutually acceptable to them to resolve any remaining such claims. If Purchaser and Seller are unable to agree on the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) choice of an amount equal to the lesser of accounting firm, they will select a nationally recognized accounting firm by lot (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.after
Appears in 1 contract
Sources: Asset Purchase Agreement (Westell Technologies Inc)
Post-Closing Adjustment. (a) Within ninety As promptly as practicable (90but not later than sixty (60) days days) following the Closing Date, Buyer the Seller shall:
(i) prepare, or shall cause the Company to, prepare and deliver to Seller a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms Accounting Principles, a consolidated balance sheet of the ML Acquired Business of the Acquired Companies as of the Effective Time (the “Preliminary Closing Date Flush Balance Sheet”); and
(ii) deliver to the Purchaser the Preliminary Closing Date Flush Balance Sheet and a certificate setting forth in reasonable detail the Seller’s calculation of the Working Capital that is allocable to the ML Acquired Business as of the Effective Time, which allocation will be consistent with and determined using the same methodology as used in the Working Capital illustration set forth on Exhibit G (the “Preliminary Flush Working Capital Determination” and, together with the Preliminary Closing Date Flush Balance Sheet, the “Preliminary Flush Closing Statement”). Until such time as the calculation of the amounts shown on the Closing Date Flush Balance Sheet and the Closing Date Flush Working Capital determinations are final and binding on the parties pursuant to this Section 2.6, the Purchaser and its accountants (at their own expense) shall be permitted to discuss with the Seller and its accountants the Preliminary Flush Closing Statement and shall be provided copies of, and have access upon reasonable notice at all reasonable times during normal business hours to, the work papers and supporting records of the Seller and its accountants that were available for purposes of the preparation and calculation of the Preliminary Flush Closing Statement so as to allow the Purchaser and its accountants to become informed concerning all matters relating to the preparation of the Preliminary Flush Closing Statement and the accounting procedures, methodologies, tests and approaches used in connection therewith; provided, that the Purchaser and its accountants shall have no such right to receive copies of or have access to the Seller’s internal correspondence or analysis to the extent they relate to a matter in dispute between the Purchaser and the Seller.
(b) Following receipt of the Preliminary Flush Closing Statement, if the Purchaser reasonably determines that the Preliminary Flush Closing Statement has not been prepared on a basis consistent with the requirements set forth in this Agreement concerning determination of the amounts set forth therein or contains a mathematical or clerical error, the Purchaser shall deliver written notice to the Seller within forty-five (45) days after the date of such receipt thereof, which notice shall set forth a specific description of the basis of each objection of the Purchaser, and to the extent then determinable, (i) a specific adjustment to each item of the Preliminary Flush Closing Statement that the Purchaser believes should be made and (ii) the Purchaser’s calculation of the Preliminary Flush Closing Statement (the “Dispute Notice”). In the event that the Purchaser does not deliver a Dispute Notice within such forty-five (45)-day period, the Preliminary Flush Closing Date Balance Sheet and the Preliminary Flush Working Capital Determination set forth therein shall be final and binding as the “Closing Date Flush Balance Sheet” and “Closing Date Flush Working Capital,” respectively, for purposes of this Agreement, including, as applicable. In the event such Dispute Notice is delivered, the Accounting Principles, Purchaser and the books Seller shall negotiate in good faith to resolve such dispute. If the Seller and records of the Company and its Subsidiaries. During the Purchaser, notwithstanding such good faith efforts, fail to resolve such dispute within thirty (30) days immediately following Seller’s receipt after delivery of the Closing StatementDispute Notice, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records then each of the Company for purposes of their Purchaser and the Seller shall engage the Arbitrator to conduct a special review of the Purchaser’s objections to the Preliminary Flush Closing Statement. The Closing Statement and Date Balance Sheet and/or Preliminary Flush Working Capital Determination, as the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto case may be, as promptly as reasonably practicable (such review to be completed no later than thirty (30) days following Seller’s receipt thereof unless Seller delivers after the Arbitrator is requested to conduct such special review), which review shall be performed consistent with the Accounting Principles and Exhibit G. Upon completion of such review, the Arbitrator shall deliver written notice to the Purchaser and the Seller setting forth the Arbitrator’s resolution of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement objections and the resulting calculation adjustments shall be deemed finally determined for purposes of this Section 2.6. The Arbitrator’s role in completing such review shall be limited to resolving such objections and determining the correct calculations to be used with respect to only the disputed portions of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Preliminary Flush Closing Statement. Any Notice In resolving such objections, the Arbitrator shall apply the provisions of Disagreement delivered pursuant to this Section 1.5(a) shall specify Agreement concerning determination of the amounts set forth in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by SellerPreliminary Flush Closing Statement, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation decision of the Cash Consideration Arbitrator shall become final and binding upon the parties be solely based on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised whether such item objected to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and was prepared in accordance with the guidelines and procedures requirements set forth in this Agreement concerning determination of the amounts set forth therein or (i.e., ii) whether the item objected to contains a mathematical or clerical error. The parties agree that the Arbitrator may not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned claimed by Buyer, on the one hand, either party or Seller, on the other hand, or less smaller than the smallest value for such item assigned claimed by Buyer, on the one hand, or Seller, on the other handeither party. The Preliminary Flush Closing Statement Date Balance Sheet and the resulting calculation of Preliminary Flush Working Capital Determination as agreed by the Cash Consideration Seller and the Purchaser or as determined by the Arbitrator, as the case may be, shall become be final and binding on as the parties hereto, if not already mutually agreed by ▇▇▇▇▇ “Closing Date Flush Balance Sheet” and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, “Closing Date Flush Working Capital,” respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Accountthis Agreement.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Post-Closing Adjustment. (aA) Within ninety Purchaser shall cause to be prepared and, as soon as practical, but in no event later than sixty (9060) days following after the Closing DateDate (which may be extended by an additional fifteen (15) days at Purchaser’s written election, Buyer shallif Purchaser determines it to be reasonably necessary under the circumstances), or shall cause to be delivered to the Company toRepresentative, prepare and deliver to Seller a statement (the “Closing Statement”) setting forth its containing the actual amounts of Closing Cash, Closing Indebtedness, Closing Working Capital and Seller Expenses, together with a calculation of the Cash Consideration and each of the components thereofbased on such amounts. The Closing Statement and all amounts, estimates, determinations and calculations contained therein shall be prepared in good faith and calculated in accordance with GAAP consistently applied. In the terms of this Agreement, includingevent that Purchaser does not provide the Closing Statement within such sixty (60)-day period (as it may be extended by an additional 15 days, as applicableprovided above), Purchaser shall be deemed to have accepted in full the Accounting PrinciplesEstimated Closing Statement as prepared by the Company, and the books Estimated Closing Statement shall be deemed final, binding and records conclusive upon Purchaser, the Company, Sellers and the Representative for all purposes hereunder as of 5:00 P.M. Eastern time on such sixtieth (60th) day (as it may be extended by an additional fifteen (15) days, as provided above).
(B) If the Company and its Subsidiaries. During Representative disagrees in whole or in part with the Closing Statement, then within thirty (30) days immediately following Seller’s after its receipt of the Closing Statement, the Company Representative shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to notify Purchaser of such disagreement in writing (the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery), prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify setting forth in reasonable detail the nature and amount particulars of any disagreement so asserted such disagreement. To be effective, any such Notice of Disagreement shall include a copy of Purchaser’s Closing Statement marked to indicate the specific line items of the Closing Statement that are in dispute (the “Disputed Line Items”) and attach documentation supporting Sellershall be accompanied by the Representative’s calculations.
calculation of each of the Disputed Line Items and the Representative’s revised Closing Statement setting forth its determination of the Consideration and any component thereof. All items that are not Disputed Line Items shall be final, binding and conclusive for all purposes hereunder unless the resolution of a Disputed Line Item affects an undisputed item, in which case such undisputed item shall remain open and be considered a Disputed Line Item to the extent of such corresponding effect. In the event that the Representative does not provide a Notice of Disagreement within such thirty (b30)-day period, the Representative shall be deemed to have accepted in full the Closing Statement as prepared by Purchaser, and such Closing Statement shall become final, binding and conclusive for all purposes hereunder as of 5:00 P.M. Eastern time on such thirtieth (30th) If a timely day. In the event any Notice of Disagreement is delivered by Sellerproperly and timely provided, then the Closing Statement (as revised in accordance with this Section 1.5(b)) Purchaser and the resulting calculation Representative shall use their respective commercially reasonable efforts for a period of the Cash Consideration shall become final and binding upon the parties on the earlier of fifteen (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (3015) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer they may mutually agree) to resolve any Disputed Line Items. During such fifteen (15)-day period, Purchaser and Seller may agree the Representative shall cooperate with each other and shall have reasonable access to the books and records, working papers, schedules and calculations of the other used in writing), Buyer the preparation of the Closing Statement and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement and the determination of the Consideration and Disputed Line Items and the officers and other employees of the other Party, in each case, to the extent reasonably necessary or appropriate in connection with the resolution of the Disputed Line Items. All Disputed Line Items agreed to during such fifteen (15)-day period shall be final, conclusive and binding on the Parties and not subject to further appeal. If, at the end of such period, Purchaser and the Representative are unable to resolve all such Disputed Line Items, then any such remaining Disputed Line Items shall be referred to a nationally-nationally recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ Purchaser and Seller not reasonably objected to by the Representative (the “ArbiterAccounting Firm”) for review and resolution); provided, that neither KPMG LLP nor PriceWaterhouseCoopers LLP shall be selected as the Accounting Firm. Buyer and Seller shall instruct the Arbiter to, Purchaser and the ArbiterRepresentative will enter into reasonable and customary arrangements for the services to be rendered by the Accounting Firm under this Section 2.2(b)(ii)(B), acting such services to be provided in the Accounting Firm’s capacity as an accounting expert and not an arbitrator, . The Accounting Firm shall make a final be directed to determine as promptly as practicable (and Purchaser and the Representative shall use commercially reasonable efforts to cause such determination of to occur within thirty (30) days) whether the items included Consideration as set forth in the Closing Statement (to the extent requires adjustment. The Accounting Firm shall be instructed that, in making such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e.determination, it may not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned claimed by Buyer, on the one hand, either party or Seller, on the other hand, or less smaller than the smallest value for such item assigned claimed by Buyereither party, on and that the one handAccounting Firm is only to consider matters still in dispute between Purchaser and the Representative. Purchaser, or Sellerthe Company and the Representative shall each furnish to the Accounting Firm such work papers and other documents and information relating to the Disputed Line Items, on the other handand shall provide interviews and answer questions, as such Accounting Firm may reasonably request. The Closing Statement and the resulting calculation determination of the Cash Consideration Accounting Firm shall become final be final, conclusive and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ Parties and Seller, shall be based solely on the date terms of this Agreement (including Section 2.2(a)) and the Arbiter delivers its final determination in writing to Buyer written submissions by Purchaser and Seller (which final determination shall be requested the Representative and not by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court independent review or otherwise appealable. investigation.
(C) The fees costs and expenses for the services of the Arbiter pursuant to this Section 1.5(b) Accounting Firm shall be borne by the CompanyPurchaser, on the one hand, and Sellerthe Sellers (based on their respective Pro Rata Shares), on the other hand, in inverse relation to their success with respect to any disputes submitted to the Accounting Firm for resolution. Subject to the foregoing sentence, each party shall be responsible for its own fees and expenses incurred in connection with this Section 2.2(b).
(D) After the Consideration has been finally determined in accordance with this Section 2.2(b)(ii) (the Consideration as so determined being referred to herein as the “Final Consideration”), the following payments shall be made:
(1) If the Final Consideration exceeds the Estimated Consideration, then Purchaser shall pay an amount in cash equal to such excess to the Sellers on a pro rata basis based upon on their respective Pro Rata Shares.
(2) If the percentage which Estimated Consideration exceeds the aggregate Final Consideration, Purchaser and the Representative shall deliver joint written instructions to the Escrow Agent instructing the Escrow Agent to disburse to Purchaser a portion of the contested amount not awarded Escrow Amount equal to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Sellerexcess), and if such amount is not sufficient to cover such excess in full Purchaser may thereafter recover any remaining amount of such excess in cash from the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerSellers.
(cE) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date Any amount payable pursuant to Section 2.2(b)(ii)(D) shall be paid within ten (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (510) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount determination of the Adjustment Escrow Amount) by Final Consideration via wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of account designated in writing by the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Accountrecipient thereof.
(dF) Within five (5Payments pursuant to this Section 2.2(b)(ii)(F) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (shall be treated for all purposes as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions adjustments to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesConsideration.
Appears in 1 contract
Post-Closing Adjustment. (a) That portion of the Purchase Price payable in accordance with Subsection 2.5(a)(v) will be subject to increase or decrease by a post-Closing adjustment pursuant to this Section 2.6.
(b) Within ninety one hundred fifty (90150) days following after the Closing DateClosing, Buyer shall, or the Purchaser shall cause the Company to, prepare and deliver to Seller the Vendors a statement (the “Closing NWC Adjustment Statement”) setting forth its the Purchaser’s reasonably detailed calculation of the Cash Consideration and each Net Working Capital as of the components thereofClosing Date (the “Purchaser’s Net Working Capital”) and the related Purchase Price adjustment, if any, required under this Section 2.6. The Closing Statement shall Purchaser’s Net Working Capital will be prepared (i) in good faith the same format as the Reference NWC Statement, and (ii) in accordance with the terms of this Agreementstandards and methodologies set out therein, includingin each case, using the relevant Business Records as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Date. For greater certainty, in calculating the Purchaser’s Net Working Capital following Closing and delivering the NWC Adjustment Statement, the Company Purchaser shall provide Seller and its representatives with reasonable accessin no way be bound, during normal business hours and after reasonable advance noticeor otherwise limited, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerEstimated Net Working Capital.
(c) If requested by the Cash Consideration is greater than Vendors in writing, the Estimated Cash Consideration Purchaser will allow the Vendors and their representatives reasonable access to review all working papers and other documentation used or prepared in connection with the preparation of, or which otherwise form the basis of, the NWC Adjustment Statement and the Fundamental Change Repurchase Date Purchaser’s Net Working Capital, as well as all Business Records relating to the operations and finances of the Vendors with respect to the period up to and including the Closing Date, and the Purchaser will make reasonably available the individuals in its employ responsible for and knowledgeable about the information used in, and the preparation or calculation (as applicable) of, the NWC Adjustment Statement and the Purchaser’s Net Working Capital in order to respond to the reasonable inquiries of the Vendors, in each case as and to the extent reasonably necessary for, and for the sole purpose of, the Vendors’ review of the NWC Adjustment Statement and the Purchaser’s Net Working Capital and provided that any of the Vendors outside representatives requesting any such term is defined access will first have executed and delivered a customary confidentiality and hold harmless agreement relating to such access to the extent requested by the Purchaser’s Counsel.
(d) If the Vendors object in good faith to any item in the Senior Secured Notes Indenture) has not yet occurredNWC Adjustment Statement, including the calculation of the Purchaser’s Net Working Capital, on the bases provided in this Section 2.6 (each, a “NWC Disputed Item”), the Vendors shall deliver written notice of such objection to the Purchaser within five fifteen (515) Business Days after the Closing receipt of the NWC Adjustment Statement becomes final and binding the Purchaser’s Net Working Capital calculation by the Vendors (such notice, a “Notice of NWC Disagreement”). The Notice of NWC Disagreement will set out in reasonable detail each NWC Disputed Item and the reasons for the Vendors’ objection to such item, the amount in dispute and reasonable details of the calculation of such amount. If requested by the Purchaser in writing, the Vendors will allow the Purchaser and its representatives reasonable access to review the working papers and other documentation used or prepared in connection with the preparation of, or which otherwise form the basis of, the Vendors’ objection to each NWC Disputed Item. The Vendors may not challenge any item in the NWC Adjustment Statement, including the calculation of the Purchaser’s Net Working Capital, on any basis other than that it contains arithmetic error or was not prepared in accordance with the terms hereof, requirements of this Agreement. The Vendors will be conclusively deemed to have accepted all items and amounts contained in the Company shall, NWC Adjustment Statement and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount calculation of the Adjustment Escrow AmountPurchaser’s Net Working Capital other than the NWC Disputed Items for which a timely Notice of NWC Disagreement is delivered in accordance with this Section 2.6.
(e) by wire transfer If the Parties cannot reach agreement on any NWC Disputed Item within fifteen (15) Business Days after a Notice of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes NWC Disagreement is delivered in accordance with Section 1.82.6, then any unresolved NWC Disputed Items (collectively, a “NWC Dispute”) will be submitted for final and binding arbitration to a senior audit partner at the Toronto office of KPMG LLP chosen by the managing partner of such office (the “NWC Arbitrator”). In the event that KPMG LLP is unwilling or unable to serve as the NWC Arbitrator, a senior audit partner at the Toronto office of Grant Th▇▇▇▇▇▇ ▇▇▇ ▇▇▇sen by the managing partner of such office will serve as the NWC Arbitrator. In the event that both KPMG LLP and Grant Th▇▇▇▇▇▇ ▇▇▇ ▇▇▇ unwilling or unable to serve as the NWC Arbitrator, either the Vendors or the Purchaser may request that the ICC International Centre for Expertise appoint as NWC Arbitrator, within ten (10) days from the date of such request or as soon as practicable thereafter, an audit partner in an internationally recognized accounting firm that is not the auditor or independent accounting firm of any of the Parties, who is a certified public accountant or chartered accountant in Canada and who is independent of the Parties and impartial. The Vendors and the Purchaser will, to the extent required, enter into a customary engagement letter with the NWC Arbitrator in a form satisfactory to each of the Vendors and the Purchaser, acting reasonably, which will include reasonable and customary confidentiality provisions.
(f) Within fifteen (15) days of the appointment of the NWC Arbitrator, the Vendors and the Purchaser will provide to the NWC Arbitrator a copy of the NWC Adjustment Statement and the Purchaser’s Net Working Capital, and will each provide a written submission that states, for each unresolved NWC Disputed Item, the dollar amount in dispute, a narrative description of how the dollar amount was calculated or derived and an explanation of the rationale for the Party’s position. The Vendors and the Purchaser will request that the NWC Arbitrator thereafter determine all matters in the NWC Dispute within thirty (30) days after such materials are submitted for the NWC Arbitrator’s review. Upon the request of the NWC Arbitrator, the Vendors and the Purchaser will provide or make available all working papers, documents and information as are reasonably required by the NWC Arbitrator to make his or her determination; provided, however, that if the Fundamental Change Repurchase Date has occurred, outside auditors of the amount by which Vendors or the Cash Consideration exceeds the Estimated Cash Consideration (up Purchaser will not be obligated to an excess equal make any working papers available to the amount of NWC Arbitrator unless and until the Adjustment Escrow Amount) shall instead be paid NWC Arbitrator has executed and delivered a customary confidentiality and hold harmless agreement relating to Seller (such access in form and held in a deposit account subject substance reasonably acceptable to a control agreement in favor of such outside auditors, to the Consenting Noteholders) extent requested by such outside auditors. Neither the Vendors nor the Purchaser will disclose to the NWC Arbitrator, and the NWC Arbitrator will not consider for any purpose, any settlement discussions or settlement offer made by the sole purpose of complying with mandatory repurchase requirements set forth in Vendors or the Senior Secured Notes Supplemental Indenture Purchaser with respect to any remaining 2025 Notes. If objection under Subsection 2.6(g), unless otherwise agreed in writing by the Estimated Cash Consideration is greater than Vendors and the Cash Consideration, within five Purchaser.
(5g) Business Days after The determination of the Closing Statement becomes NWC Arbitrator will be final and binding on the Parties (for greater certainty, with no right of appeal or judicial review on any grounds other than for fraud or manifest error on the part of the NWC Arbitrator), and may only be corrected for arithmetic error or to cause the NWC Disputed Items to be prepared in accordance with this Agreement, on written application to the NWC Arbitrator delivered within fifteen (15) days of the date of his or her determination. The NWC Adjustment Statement and the Purchaser’s Net Working Capital will be (or not be, as applicable) adjusted in accordance with the terms hereofNWC Arbitrator’s determination. In resolving the NWC Dispute, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions NWC Arbitrator will be limited to the Escrow Agent) addressing any particular NWC Dispute referred to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer Notice of NWC Disagreement and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to will make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held all calculations in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying manner consistent with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture this Section 2.6; provided that such calculation will, with respect to any remaining 2025 Notes.NWC Disputed Item, be no greater than the higher amount calculated by the Vendors or the Purchaser, and no less than the lower amount calculated by the Vendors or the Purchaser, in the Parties’ submissions to the NWC Arbitrator under this Section 2.6, as the case may be. The NWC Arbitrator’s review and determination will be based solely on the grounds presented by the Vendors and the Purchaser, and will be limited to correcting arithmetic errors in respect of the NWC Disputed Items or causing the NWC Disputed Items to be prepared in accordance with this Agreement and the NWC Arbitrator shall have no power or authority to address or resolve any other issues. Each of the Parties shall bear its own costs and expenses of this arbitration under this Section 2.6. The costs and expenses of the NWC Arbitrator (and the ICC International Centre for Expertise, if applicable) under this Section
Appears in 1 contract
Sources: Master Asset Purchase Agreement (Venus Concept Inc.)
Post-Closing Adjustment. (a) Within ninety sixty (9060) days following after the Closing Date, Buyer Purchaser shall, or in its absolute discretion be entitled (but shall cause not, for the Company toavoidance of doubt, be required) to prepare and deliver to Seller a statement the Holder Representative good faith calculation of the Net Working Capital as at Closing (the “Proposed Closing StatementBalance Sheet”) setting forth its calculation ). The Proposed Closing Balance Sheet shall include all of the Cash Consideration and each of balance sheet line items included in the components thereof. The Estimated Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsBalance Sheet.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery Holder Representative’s receipt of the Proposed Closing Balance Sheet (the “Closing Balance Sheet Review Period”), the Holder Representative will be provided with reasonable access (including electronic access) to the financial records of the Company, for purpose of reviewing the Proposed Closing Balance Sheet and Purchaser, the Company and their respective Representatives shall assist and reasonably cooperate in good faith with the Holder Representative, in connection with its review of the Proposed Closing Balance Sheet.
(c) The Holder Representative shall notify Purchaser in writing (the “Notice of Disagreement”) prior to the expiration of the Closing Balance Sheet Review Period if the Holder Representative disagrees with the Proposed Closing Balance Sheet. The Notice of Disagreement shall set forth in reasonable detail the basis for such dispute, the amounts involved and the Holder Representative’s determination of the amount of the Net Working Capital. If no Notice of Disagreement is given to Purchaser prior to the expiration of the Closing Balance Sheet Review Period, then the Proposed Closing Balance Sheet shall be deemed to have been accepted by the Holder Representative and shall become final, binding and conclusive upon the Parties.
(d) If a Notice of Disagreement is given to Purchaser prior to the expiration of the Closing Balance Sheet Review Period, then the Holder Representative and Purchaser shall meet (which meeting may take place via teleconference) shall confer in good faith for a period of up to thirty (30) calendar days of delivery of such Notice of Disagreement (or at such longer period as Buyer other time and Seller may place mutually agree in writing, Buyer between the parties) and Seller may attempt use all reasonable efforts to resolve any differences which that they may have with respect to any matter the matters specified in the Notice of Disagreement, .
(e) If the Holder Representative and Purchaser have been unable to resolve all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules differences they may have with respect to the matters specified in the Notice of Evidence and any applicable similar Law. At Disagreement the end of such thirty (30) day days’ period (or such longer other period as Buyer may be mutually agreed by Purchaser and Seller may agree in writingthe Holder Representative), Buyer either the Holder Representative or Purchaser may submit any amounts remaining in dispute (the “Disputed Amounts”) for resolution to an Accounting Arbitrator who shall have the privileges, powers and Seller immunities of an arbitrator. The Accounting Arbitrator shall only decide the specific items under dispute by the parties and their decision for each Disputed Amount must be within the range of values assigned to each such item in the Proposed Closing Balance Sheet and the Notice of Disagreement, respectively. Each of Purchaser and the Holder Representative shall submit a statement of its position and supporting documentation within twenty (20) days of engagement of the Accounting Arbitrator. The Accounting Arbitrator shall be instructed to make a determination as soon as practicable, and in any event within sixty (60) calendar days after their engagement. The Accounting Arbitrator shall prepare a written statement setting forth their resolution of the Disputed Amounts and all matters adjustments to the Proposed Closing Balance Sheet.
(but only such mattersf) The statement which remain in dispute is (i) the Estimated Closing Balance Sheet delivered by the Company to the Purchaser, if the Purchaser fails to deliver the Proposed Closing Balance Sheet to the Company, (ii) the Proposed Closing Balance Sheet, if the Holder Representative fails to deliver through the expiration of the Closing Balance Sheet Review Period a Notice of Disagreement, or (iii) the closing balance sheet statement as adjusted through an agreement of Purchaser and which were properly included the Holder Representative after resolving the Disputed Amounts set forth in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller Disagreement, (iv) the “Arbiter”) for review and resolution. Buyer and Seller shall instruct closing balance sheet statement as adjusted through the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter Accounting Arbitrator pursuant to this Section 1.5(b) 2.12 (the “Final Closing Balance Sheet”). The Final Closing Balance Sheet shall be borne by the Companyfinal, binding and conclusive on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerparties.
(cg) If The Estimated Closing Statement, the Cash Consideration is greater than Proposed Closing Statement, the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Final Closing Statement becomes final and binding all related calculations and documents shall be prepared in accordance with GAAP applied using the same accounting methods, policies, practices and procedures, with consistent classifications, judgments and estimation methodology, in each case to the extent consistent with GAAP, as were used in the preparation of the Annual Financial Statements (as defined below); provided however, that the Net Working Capital, and the Company’s Debt shall be adjusted as defined pursuant to the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account).
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety As promptly as practicable after the Closing, but in any event within seventy-five (9075) days following after the Closing Date, Buyer shall, or shall cause the Company to, Purchaser will prepare and deliver to Seller a statement based on the Accounting Principles (the “Post-Closing Statement”) setting forth its in reasonable detail Purchaser’s good faith calculation of (i) the Cash Consideration Net Working Capital and the NWC Adjustment, (ii) the Closing Cash, (iii) the Closing Indebtedness, (iv) the Acquired Companies Transaction Expenses and (v) the proposed Final Purchase Price, in each case, determined as of the components thereof. The Closing Statement shall be prepared in good faith Reference Time and in accordance with the terms of Accounting Principles and this Agreement, including, as applicable, the Accounting Principles, and based on the books and records of the Company and its SubsidiariesAcquired Companies. During the thirty (30) days immediately following Seller’s Upon receipt of the Post-Closing Statement, the Company shall provide Seller and its agents and representatives with shall be given reasonable on-site access, during normal business hours and after upon reasonable advance prior notice, to or copies of (as Seller shall request), solely relevant for the purpose of verifying the Post-Closing Statement and upon execution of a customary access letter if required by Purchaser’s outside accountants, if applicable: (A) all of the books and records records, work papers, trial balances and other materials relating to the Post-Closing Statement; and (B) Purchaser’s and the Acquired Companies’ personnel and accountants. If Purchaser does not deliver the Post-Closing Statement to Seller within seventy-five (75) days after the Closing Date, Purchaser shall be deemed to have agreed on the Closing Statement delivered by Seller pursuant to Section 1.3(b) and such Closing Statement (and the calculations therein) shall be final, non-appealable and binding on the Parties hereto.
(b) Seller may, within forty-five (45) days after delivery of the Company for purposes of their review Post-Closing Statement (the “Seller Notice Period”), deliver a notice to Purchaser disagreeing with specific items in the Post-Closing Statement and setting forth Seller’s calculation of the Net Working Capital, NWC Adjustment, Closing StatementCash, Closing Indebtedness and the Acquired Companies Transaction Expenses, together with supporting documentation and work papers describing in reasonable detail how such specific items were derived, calculated or otherwise determined (the “Notice of Disagreement”). The If Seller does not deliver the Notice of Disagreement within the Seller Notice Period, then Seller will be deemed to have agreed to the Post-Closing Statement and the resulting calculation computation of the Cash Consideration shall become final Purchase Price set forth therein will be final, conclusive and binding upon on the parties hereto Parties for all purposes hereunder.
(c) If Seller delivers the Notice of Disagreement within the Seller Notice Period, Purchaser and Seller, during the thirty (30) days following Seller’s receipt thereof unless such delivery, will cooperate in good faith to reach agreement in writing on the disputed items or amounts in order to determine the Final Purchase Price. If the Parties so resolve all disputes, the computation of the Purchase Price agreed upon by the Parties, will be final, conclusive and binding on the Parties for all purposes hereunder.
(d) If Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered within the Seller Notice Period, and Purchaser and Seller are unable to reach an agreement on the disputed items within the period described in Section 1.5(c), the Parties will jointly engage an independent nationally recognized accounting firm to be agreed upon by Purchaser and Seller (the “Independent Accountant”) (with the initial engagement costs paid fifty (50%) by Purchaser and fifty (50%) by Seller, and with the contribution of such costs by Purchaser or Seller, as applicable, reimbursed or credited following the final allocation of fees and disbursements of the Independent Accountant pursuant to this Section 1.5(a) 1.5(d)), to review this Agreement and solely the disputed items or amounts for the purpose of calculating the Final Purchase Price (it being understood that, in making such calculation, the Independent Accountant will function as an expert and not as an arbitrator). The scope of the disputes to be resolved by the Independent Accountant shall specify be limited to correcting mathematical errors and determining whether the items and amounts in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised dispute were determined in accordance with the Accounting Principles and this Section 1.5(b)) Agreement, and the resulting Independent Accountant is not to make any other determination, including any determination as to whether the definition of “Target Net Working Capital” is adequate or sufficient. In making its calculation of the Cash Consideration shall become final and binding upon Final Purchase Price, the parties on the earlier of Independent Accountant (i) will apply the date any Accounting Principles including definitions of “Net Working Capital,” “Closing Cash,” “Closing Indebtedness” and all matters specified “Acquired Companies Transaction Expenses” in this Agreement, (ii) will consider only those items or amounts in the Post-Closing Statement as to which Seller specifically disputes in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (iiiii) the date any and all matters specified in the Notice of Disagreement will not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, Purchaser or Seller, on the other hand, Seller or less than the smallest value for such item assigned by BuyerPurchaser or Seller in the Post-Closing Statement or the Notice of Disagreement, on the one hand, or Seller, on the other handas applicable. The Closing Statement Independent Accountant’s decision shall be based solely on written submissions by Purchaser and Seller and their respective Representatives and in no event shall any Party engage in any ex parte communications with the resulting calculation of Independent Accountant. Purchaser and Seller shall use their commercially reasonable efforts to cause the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ Independent Accountant to deliver to Purchaser and Seller, on the date the Arbiter delivers its final determination as promptly as practicable (but in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than any event within thirty (30) days following submission after the date of such disputed mattersengagement of the Independent Accountant), and such final determination by a report setting forth its calculation of the Arbiter shall not be subject to court review or otherwise appealableFinal Purchase Price. The fees Independent Accountant’s calculation of the Final Purchase Price will be final, conclusive and binding on the Parties for all purposes hereunder. Subject to the following sentence, the costs of any dispute resolution pursuant to this subsection, including the fees, costs and expenses of the Arbiter pursuant to this Section 1.5(b) Independent Accountant and of any enforcement of the determination thereof, shall be borne by Purchaser and Seller in proportion to the Company, on final allocation made by the one hand, Independent Accountant of the disputed items weighted in relation to the claims made by Purchaser and Seller, on such that the other handprevailing Party pays the lesser proportion of such fees, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer costs and Seller, respectively, bears to the aggregate amount actually contested by such partyexpenses. For example, if Seller claims that the Cash Consideration is appropriate adjustments are $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, Purchaser and if the Arbiter Independent Accountant ultimately resolves the dispute by awarding to Seller $300 of the $500 1,000 contested, then the fees, costs and expenses of the Arbiter will Independent Accountant shall be allocated 60% thirty percent (i.e., 30%) (i.e. 300 ÷ 500divided by 1,000) to the Company Purchaser and 40% seventy percent (i.e., 200 ÷ 50070%) (i.e. 700 divided by 1,000) to Seller. Notwithstanding the foregoing, the fees and disbursements of the Representatives of each Party incurred in connection with their preparation or review of the Post-Closing Statement and preparation or review of any Notice of Disagreement, as applicable, shall be borne by such Party.
(e) The final, conclusive and binding Purchase Price as determined in accordance with Section 1.5(b), (c) and (d), will be referred to as the “Final Purchase Price.”
(f) If the Cash Consideration Final Purchase Price is greater than the Estimated Cash Consideration Purchase Price (such excess, the “Purchase Price Excess Amount”), Purchaser will promptly, and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within no event later than five (5) Business Days after determination of the Closing Statement becomes final and binding Final Purchase Price in accordance with the terms hereofthis Section 1.5, the Company shall, and Buyer shall pay or cause the Company to, make a payment to the Note Escrow Account of be paid to Seller an aggregate amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Purchase Price Excess Amount) , by wire transfer of immediately available funds for purposes to the Seller Account.
(g) If the sum of making an offer to repurchase the 2026 Notes and Final Purchase Price is less than the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurredEstimated Purchase Price (such deficit, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow “Purchase Price Deficit Amount) shall instead be paid to ”), Seller (will promptly, and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater no event later than the Cash Consideration, within five (5) Business Days after determination of the Closing Statement becomes final and binding Final Purchase Price in accordance with the terms hereofthis Section 1.5, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions pay to the Escrow Agent) to make payment to Buyer (or its designees) of Purchaser an aggregate amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash ConsiderationPurchase Price Deficit Amount, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making to an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesspecified by Purchaser.
Appears in 1 contract
Sources: Stock Purchase Agreement (Nn Inc)
Post-Closing Adjustment. (a) Within ninety (90) days following As promptly as practicable, but no later than 60 days, after the Closing Date, Buyer shall, or shall cause to be prepared and delivered to the Company to, prepare and deliver to Seller Holders’ Representative a statement (the “Post-Closing Statement”) setting forth Buyer’s calculation of (i) Closing Indebtedness, (ii) Closing Cash, (iii) Company Transaction Expenses, (iv) Closing Working Capital and (v) Notional Rollover Share Merger Consideration. Buyer shall also deliver to the Holders’ Representative its calculation, using the amounts set forth on the Post-Closing Statement, of the Aggregate Purchase Price, and the Per Share Merger Consideration in respect of each Share, Option Consideration in respect of each Option and the Warrant Consideration in respect of each Warrant. Buyer shall provide the Holders’ Representative with access to such information used by Buyer in its calculation of such amounts as is reasonably necessary for the Cash Consideration and each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, Holders’ Representative to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsamounts.
(b) If a timely Notice the Holders’ Representative disagrees with Buyer’s calculation of Disagreement is delivered by Seller, then any of the items set forth on the Post-Closing Statement delivered pursuant to Section 2.14(a), the Holders’ Representative may, within 30 days after receipt of the Post-Closing Statement, deliver a notice to Buyer disagreeing with such calculation, specifying the Holders’ Representative’s calculation of such amount and, in reasonable detail, the Holders’ Representative’s grounds for such disagreement. Any such notice of disagreement shall specify those items or amounts as to which the Holders’ Representative disagrees, and the Holders’ Representative shall be deemed to have agreed with all other items and amounts contained in the Post-Closing Statement delivered pursuant to Section 2.14(a).
(c) If the Holders’ Representative delivers a notice of disagreement pursuant to Section 2.14(b), Buyer and the Holders’ Representative shall, during the 15 days after delivery thereof, use their commercially reasonable efforts to reach agreement on the disputed items or amounts in order to determine the Aggregate Purchase Price. If Buyer and the Holders’ Representative are unable to reach agreement as revised to such amount during such period, the parties shall promptly thereafter cause the Accounting Referee to promptly review this Section 2.14 (and any related definitions) and the disputed items or amounts for the purpose of calculating Aggregate Purchase Price. In making such calculation, such independent accounting firm shall (w) be limited to a review of whether the disputed amounts were calculated in accordance with this Section 1.5(b2.14 (and any related definitions), (x) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified consider only those items or amounts in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Post-Closing Statement as to which the Holders’ Representative has disagreed and shall therefore be revised bound as to the extent necessary all other matters and calculations as to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to and the extent such amounts Post-Closing Statement are in disputeaccord, (y) based solely on written submissions be bound in all respects and for all purposes by ▇▇▇▇▇ the definitions hereof and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not toAgreed Accounting Principles, and the Arbiter shall not, not assign a value to any item in dispute disputed amount greater than the greatest value higher of the amounts proposed by Buyer and Holders’ Representative or less than the lower of the amounts proposed by Buyer and Holders’ Representative, and (z) not consider in any respect or for any purpose any settlement discussions or settlement offer made by or on behalf of Buyer or the Holders, unless otherwise agreed by Buyer and the Holders’ Representative, and no party hereto will disclose (or permit its representatives to disclose) to the Accounting Referee any such item assigned discussions or offer. The Accounting Referee shall deliver to Buyer and the Holders’ Representative, as promptly as practicable, a report setting forth its calculation of Aggregate Purchase Price. Such report shall be final and binding upon Buyer and the Holders’ Representative without any right to appeal or bring suit to challenge the calculation of the Aggregate Purchase Price (or any component or consequences thereof). The cost of such review and report shall be borne (i) by the Holders, if the difference between the Final Aggregate Purchase Price and the Holders’ Representative’s calculation of Aggregate Purchase Price delivered pursuant to Section 2.14(b) is greater than the difference between the Final Aggregate Purchase Price and Buyer’s calculation of Aggregate Purchase Price delivered pursuant to Section 2.14(a), (ii) by Buyer, if the difference between the Final Aggregate Purchase Price and the Holders’ Representative’s calculation of Aggregate Purchase Price delivered pursuant to Section 2.14(b) is less than the difference between the Final Aggregate Purchase Price and Buyer’s calculation of Aggregate Purchase Price delivered pursuant to Section 2.14(a) and (iii) otherwise, equally by Buyer, on the one hand, or Seller, on and the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or SellerHolders, on the other hand. The Closing Statement and Costs for which the resulting calculation Holders are responsible in accordance with the prior sentence shall be paid from the Purchase Price Adjustment Escrow Account. In the event that such costs exceed the remaining Purchase Price Adjustment Escrow Amount, any excess shall be paid from the Indemnity Escrow Account. If the Holders are responsible for all or a part of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees costs and expenses of such review and report, Buyer and the Arbiter pursuant Holders’ Representative will jointly instruct the Escrow Agent to this Section 1.5(bpay out of the Purchase Price Adjustment Escrow Account and/or the Indemnity Escrow Account, as applicable, to the account(s) shall be borne specified by the CompanyAccounting Referee, on the one handby wire transfer of immediately available funds, and Seller, on the other hand, based upon the percentage which the aggregate a portion of the contested amount not awarded to Buyer and Seller, respectively, bears held in such escrow account equal to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will Accounting Referee payable by the Holders, and the release of amounts from the Purchase Price Adjustment Escrow Account by Sections 2.06(c) and 2.14(e) shall be allocated 60% (i.e., 300 ÷ 500) made after giving effect to such payment to the Company and 40% (i.e., 200 ÷ 500) to SellerAccounting Referee.
(cd) The Holders’ Representative and Buyer agree that they shall, and Buyer agrees to cause its and the Surviving Corporation’s respective independent accountants and the Subsidiaries of the Surviving Corporation to, cooperate and assist in the preparation of the Post-Closing Statement and the calculation of Aggregate Purchase Price and in the conduct of the reviews referred to in this Section 2.14, including making available to the extent necessary books, records, work papers and personnel.
(e) If the Cash Consideration Final Aggregate Purchase Price is less than the Estimated Aggregate Purchase Price, then Buyer shall be entitled to (x) payment of an amount equal to such shortfall from the Purchase Price Adjustment Escrow Account and (y) to receive from the Indemnity Escrow Account the additional amount (if any) by which the Final Aggregate Purchase Price is less than the Estimated Aggregate Purchase Price. In the event that the Holders’ obligations under this Section 2.14 exceed the sum of the Purchase Price Adjustment Escrow Amount plus the Indemnity Escrow Amount, such excess shall be paid to Buyer by the Holders pro rata to their relative Indemnity Percentages. If the Final Aggregate Purchase Price is greater than the Estimated Cash Consideration and Aggregate Purchase Price, then the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer Holders shall cause the Company to, make a be entitled to payment to the Note Escrow Account of an amount equal to such excess, to be paid by or on behalf of Buyer to the Exchange Agent, and in turn to be distributed by the Exchange Agent among the Holders pro rata to their Remaining Possible Consideration. If any amounts remain in the Purchase Price Adjustment Escrow Account after the applicable payment pursuant to this Section 2.14(e), then such remaining amount shall be promptly released from the Purchase Price Adjustment Escrow Account (i) to the Exchange Agent, in respect of any Stockholders and Directly Exercisable Warrant Holders, to be distributed by the Exchange Agent among such Stockholders and Directly Exercisable Warrant Holders pro rata to their Remaining Possible Consideration and (ii) to the Surviving Corporation, in respect of Option Holders to be distributed to such Option Holders pro rata to their Remaining Possible Consideration. Any payment from Buyer or the Escrow Account pursuant to this Section 2.14(e) shall be made within three Business Days after the date on which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) Final Aggregate Purchase Price has been determined, by wire transfer of immediately available funds for purposes of making an offer by Buyer or the Escrow Agent (as directed by the parties), as the case may be, to repurchase the 2026 Notes applicable party or parties. Buyer and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal Holders’ Representative shall deliver to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect Agent irrevocable instructions giving effect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5payment or release provided for by this Section 2.14(e) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause of the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow AccountAgreement.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Merger Agreement (Actua Corp)
Post-Closing Adjustment. (a) Within ninety (90) days As soon as reasonably practicable following the Closing Date, Buyer shalland in any event within sixty (60) days after the Closing Date, or Buyer, at its sole cost and expense, shall cause the Company to, prepare and deliver to Seller a the Holder Representative an unaudited statement (the “Buyer’s Closing Statement”) setting forth its Buyer’s good faith calculation of (i) the Cash Consideration Closing Date Working Capital (ii) the Closing Date Indebtedness and each (iii) the Company Transaction Expenses. The Holder Representative and its accountants and representatives may review Buyer’s Closing Statement and may make inquiry of the components thereof. The Closing Statement representatives of Buyer’s accountants and Buyer, who shall be prepared in good faith in accordance reasonably cooperate with the terms Holder Representative. Following the delivery of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following SellerBuyer’s receipt of the Closing Statement, the Company shall provide Seller Holder Representative and its representatives with and agents shall be afforded reasonable access, during normal business hours and after upon reasonable advance prior notice, to the books and records of the Company Surviving Corporation and reasonable access, during normal business hours and upon reasonable prior notice, to such personnel and representatives of the Surviving Corporation and Buyer, including to the individuals responsible for preparing Buyer’s Closing Statement, for the purposes of their review of preparing and reviewing the calculations contemplated by this Section 2.8.2(a). The calculations regarding the Closing Statement. The Date Working Capital, Closing Date Indebtedness and Company Transaction Expenses contained in Buyer’s Closing Statement shall be binding and conclusive upon, and deemed accepted by, the resulting calculation of Holder Representative unless the Cash Consideration Holder Representative shall become final and binding upon the parties hereto have notified Buyer in writing within thirty (30) days following Sellerafter receipt of Buyer’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement of any objections thereto (which written objection must set forth in reasonable detail the basis for any such disagreement and the resulting Holder Representative’s good faith calculation of the Cash Consideration items in Buyer’s Closing Statement). At the request of either the Holder Representative or Buyer, any dispute between the Parties relating to the calculations in Buyer’s Closing Statement (such disputed amounts, the “Disputed Amounts”) that cannot be resolved by them within ten (10) days after Buyer’s receipt of notice of any objections to such calculation pursuant to this Section 2.8.2(a) shall become be referred to Deloitte & Touche LLP (the “Disputes Auditor”) for decision, which decision shall be final and binding upon on the parties upon SellerParties. In no event shall the Disputes Auditor assign a value to Closing Date Working Capital, Closing Date Indebtedness or Company Transaction Expenses that is greater than the highest or less then the lowest calculation thereof proposed by Buyer in the Buyer’s delivery, prior to Closing Statement or the expiration of Holder Representative in the Disputed Amounts. The Parties agree that they will request that the Disputes Auditor render its decision within thirty (30) day period, of written notice to Buyer of its acceptance days after referral of the Closing Statementdispute to the Disputes Auditor for decision pursuant hereto. Any Notice Each Party shall bear the fees and disbursements of Disagreement delivered pursuant to this Section 1.5(atheir respective representatives incurred in connection with their preparation or review of the Disputed Amounts. The Holder Representative (on behalf of the Shareholders) shall specify pay (through a disbursement from the Holder Representative Expense Account) a portion of the fees and expenses of the Disputes Auditor equal to 100% 3063972 7 multiplied by a fraction, the numerator of which is the Disputed Amounts submitted to the Disputes Auditor that are resolved in reasonable detail favor of Buyer (that being the nature difference between the Disputes Auditor’s determination and the Holder Representative’s determination) and the denominator of which is the total amount of any disagreement so asserted Disputed Amounts submitted to the Disputes Auditor (that being the sum total by which Buyer’s determination and attach documentation supporting Sellerthe Holder Representative’s calculations.
(b) If a timely Notice determination differ from the determination of Disagreement the Disputes Auditor). Buyer shall pay that portion of the fees and expenses of the Disputes Auditor that the Holder Representative is delivered by Seller, then not required to pay hereunder. The date on which the Closing Statement (as revised Date Working Capital, Closing Date Indebtedness and Company Transaction Expenses are finally determined in accordance with this Section 1.5(b)2.8.2(a) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (is hereinafter referred to as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “ArbiterDetermination Date.”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Merger Agreement (Costar Group Inc)
Post-Closing Adjustment. The Purchase Price shall be subject to adjustment following the Closing as hereinafter provided. Within fifteen (a15) Within ninety (90) business days following after the Closing Date, Buyer shall, or the Seller shall cause the Company to, prepare and deliver to Seller the Buyer a statement proposed balance sheet of the Business as of the close of business on the Closing Date (the “Closing Statement”"Final Balance Sheet") setting forth its calculation along with a certification of the Cash Consideration and each chief financial officer of the components thereof. The Closing Statement shall be Seller that such balance sheet was prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company Division and its Subsidiaries. During in conformity with the thirty (30) days immediately following Seller’s receipt of accounting practices and procedures used to prepare the Closing StatementBalance Sheet. Subject to Section 8.1, the Company Buyer agrees that the Seller shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, have access to the books and records relating to the Business for the purpose of preparing the Company for purposes of their review of the Closing StatementFinal Balance Sheet. The Closing Statement and Buyer shall review the resulting calculation Final Balance Sheet and, in the event that the Buyer disagrees with the Seller's treatment of any item or items on such balance sheet, shall provide to the Cash Consideration shall become final and binding upon Seller, within fifteen (15) business days after receipt of such balance sheet (the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers "Review Period"), a written notice of its disagreement (a “Notice of Disagreement”the "Objection Notice") to Buyer prior to such date; provided that setting forth the Closing Statement disputed item or items and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature of and reasons for the Buyer's objections with respect to the treatment of such item or items; it being understood that any item or items on the Final Balance Sheet not addressed in the Objection Notice shall be deemed accepted by the Buyer. The Final Balance Sheet shall be deemed accepted by the Buyer unless the Buyer delivers the Objection Notice within the Review Period. In the event that the Buyer and the Seller are unable to agree on the manner in which any item or 11 items should be treated in preparation of the Final Balance Sheet, such item or items shall be promptly referred by the Buyer and the Seller to Coopers & ▇▇▇▇▇▇▇ L.L.P. ("C&L") for resolution within fifteen (15) business days. The manner in which C&L shall in writing determine that such item or items should be treated in the preparation of the Final Balance Sheet shall be binding and conclusive on the parties and shall be so reflected in the Final Balance Sheet. The Buyer and the Seller shall share equally the costs of retaining C&L. If the amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
Net Assets of the Division set forth on the Final Balance Sheet (bthe "Final Net Assets Amount") If a timely Notice exceeds $3,495,000 (i.e., the amount of Disagreement is delivered Net Assets of the Division set forth on the Closing Balance Sheet) (the "Closing Net Assets Amount") by Sellermore than ten percent, then the Closing Statement Buyer shall pay to the Seller an amount equal to (as revised in accordance with this Section 1.5(b)a) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier excess of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and Final Net Assets Amount over (ii) the Closing Net Assets Amount plus (b) interest on such excess from the Closing Date to but excluding the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter payment at an interest rate equal to eight percent (as defined below8%). The If the Closing Statement Net Assets Amount exceeds the Final Net Assets Amount by more than ten percent, then the Seller shall be revised pay to the extent necessary Buyer an amount equal to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by (x) the Arbiter in accordance with this Section 1.5. During the thirty excess of (30i) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement Net Assets Amount over (ii) the Final Net Assets Amount plus (y) interest on such excess from the Closing Date to but excluding the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement date of payment at an interest rate equal to eight percent (i.e., not on the basis of an independent review8%). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller Any payment required to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter made pursuant to this Section 1.5(b) 2.4 shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater made no later than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days business days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account determination of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) due, by wire transfer of immediately available funds for purposes of making an offer to repurchase such account or accounts as designated by the 2026 Notes and party receiving the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Accountpayment.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Asset Purchase Agreement (Figgie International Inc /De/)
Post-Closing Adjustment. (a) Within ninety sixty (9060) days following the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement (the “Closing Statement”) setting forth its calculation of the Closing Cash Consideration and each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and except as otherwise contemplated by the books and records definitions of the Company and its SubsidiariesNet Working Capital, Indebtedness or Cash. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Closing Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers de livers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Closing Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b1.4(b)) and the resulting calculation of the Closing Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ Buyer and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below)) in accordance with this Section 1.4. The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ Buyer and Seller or and any final resolution determined by the Arbiter in accordance with this Section 1.51.4. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt shall seek in good faith to resolve in writing any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto shall (unless otherwise agreed by ▇▇▇▇▇ Buyer and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Lawstate rule. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing)period, Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by McGladrey & ▇▇▇▇▇ and Seller ▇▇, LLP (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the ArbiterArbiter shall, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review)Agreement. Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. Buyer and Seller shall also instruct the Arbiter to, and the Arbiter shall, make its determination based solely on presentations by Buyer and Seller that are in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). The Closing Statement and the resulting calculation of the Closing Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ Buyer and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ Buyer and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b1.4(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, each party bears to the aggregate amount actually contested by such partycontested. For example, if Seller claims the Closing Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ Buyer contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Closing Cash Consideration is greater than the Estimated Closing Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurredConsideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account Seller of an amount equal to the amount by which the Closing Cash Consideration exceeds the Estimated Closing Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amountaccount(s) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notespreviously designated by Seller. If the Estimated Closing Cash Consideration is greater than the Closing Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Closing Cash Consideration exceeds the Closing Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) Consideration by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8account(s) designated by Buyer; provided, however, that if Buyer, in its sole discretion, may elect to be paid such amount from the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth as defined in the Senior Secured Notes Supplemental Indenture with respect Escrow Agreement) in the Escrow Account (as defined in the Escrow Agreement), in which case Seller shall deliver any instruction or other documentation required by the Escrow Agent to any remaining 2025 Notespermit such payment to Buyer (or its designees).
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety Following the Closing, Buyer shall cause Arthur Andersen L.L.P. or such other "big five" accounting firm selec▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇d approved by Seller (90which approval shall not be unreasonably withheld) (the "Auditor") to prepare a valuation of Accounts Receivable and Inventory (the "Auditor Report"). The Auditor Report shall be prepared in accordance with the principles set forth on Exhibit C, and shall set forth the value of Accounts Receivable as of the Closing Date (the "Accounts Receivable Value") and the value of the Inventory as of the Closing Date (the "Inventory Value"), in each case in accordance with GAAP applied in accordance with Exhibit C. In addition, the Audit Report shall set forth the value of all deposits and prepayments made by Seller in respect of Assumed Contracts, which deposits and prepayments will inure to the benefit of Buyer and are identified on Schedule 1.05
(a) (the "Deposit/Prepayment Value"). For purposes of this Agreement and the Auditor Report, the aggregate Deposit/Prepayment Value shall not exceed $500,000. The Audit Report shall state the sum of the Accounts Receivable Value plus the Inventory Value plus the Deposit/Prepayment Value (the "Audited Value"). The Auditor shall deliver the Auditor Report to Buyer and Seller within thirty (30) business days of the Closing Date (the "Audit Report Date"). Buyer and Seller shall share equally the cost of the Auditor Report.
(b) If Seller disputes the Auditor Report, Seller shall so notify Buyer in writing (a "Notice of Dispute") within ten (10) days following after the Closing Datedate of Seller's receipt of the Auditor Report, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement (the “Closing Statement”) setting forth specifying its calculation of the Cash Consideration Accounts Receivable Value and each the Inventory Value and any other points of disagreement. Upon receipt of a Notice of Dispute, Buyer shall promptly consult with Seller with respect to such alternate calculation and points of disagreement in an effort to resolve such dispute (in connection with such effort to resolve disputes, and in connection with the Auditor's preparation of the components thereof. The Closing Statement Auditor Report, Buyer shall be prepared in good faith in accordance with the terms of this Agreementgrant to Seller, including, as applicable, the Accounting Principles, its agents and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with Auditors reasonable access, during normal business hours and after reasonable advance notice, access to the books and records of Buyer pertaining to the Company for purposes of their review of the Closing StatementInventory and Accounts Receivable). The Closing Statement If any such dispute cannot be resolved by Seller and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty Buyer within five (305) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to after Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of receives a Notice of Disagreement or such longer period Dispute from Seller, Seller and Buyer shall immediately appoint the Boston, Massachusetts office of Ernst & Young LLP to act as Buyer an arbitrator (the "Accounting Arbitrator") to determine the appropriate calculation of each of the Accounts Receivable Value, the Inventory Value, the Deposit/Prepayment Value, the Audited Value and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have all other remaining points of disagreement with respect to the Auditor Report (the "Review"). Seller and Buyer understand and agree that, in resolving any matter specified dispute with respect to the Auditor Report, the Accounting Arbitrator shall apply GAAP and the standards set forth on Exhibit C. All determinations made by the Accounting Arbitrator shall be final, conclusive and binding. The Accounting Arbitrator shall be directed to hold a hearing within ten (10) days of appointment (which hearing shall be held in the Notice of DisagreementBoston, Massachusetts) and all to make a determination within five (5) days after such discussions related thereto (hearing, unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealableparties. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) Accounting Arbitrator shall be borne equally by the Company, on the one hand, Seller and Seller, on the other hand, based upon the percentage which the aggregate portion by Buyer. Each of the contested amount not awarded to Buyer parties shall bear its own attorneys' and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs accounting fees and expenses of incurred in connection with the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerReview.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within Within five (5) Business Days after business days of the Closing Statement becomes final later of (x) the Audit Report Date and binding (y) in accordance with the terms hereofcase of any dispute of pursuant to Section 1.05(b), the Company shall, and Buyer shall cause resolution of such dispute:
(i) If the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration Audited Value exceeds the Estimated Cash Consideration $80,300,000 (up to an excess equal to the amount of such excess being the Adjustment Escrow Amount"Additional Purchase Price"), then
(A) Buyer shall pay Seller by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser Additional Purchase Price and (B) Buyer shall pay to Seller the Retention Amount by wire transfer of (i) an amount equal to immediately available funds. Under no circumstances shall the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and Additional Purchase Price exceed $25,000,000.
(ii) If the Audited Value is less than $80,300,000, then Buyer shall be entitled to the difference between $80,300,000 and the Audited Value (the "Downward Adjustment Escrow FundsAmount"); provided, in each casehowever, from that under no circumstances shall the Downward Adjustment Escrow Account.
Amount exceed $25,000,000. If the Downward Adjustment Amount exceeds the sum of the Retained Amount plus the Estimated Payment (dsuch excess being herein referred to as the "Required Additional Payment"), then (A) Within five (5) Business Days after first, the Closing Statement becomes final Retention Amount shall be credited to and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, retained by Buyer and Seller shall cause (B) the Escrow Agent (including by delivering joint written instructions shall pay to the Escrow Agent) to make a payment Buyer from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) existing Accounts Receivable/Inventory Holdback Amount by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8Required Additional Payment; provided, provided further that if the Fundamental Change Repurchase Date Downward Adjustment Amount exceeds $20,000,000, Seller shall pay to Buyer by wire transfer of immediately available funds such excess amount up to an amount not to exceed $5,000,000.
(iii) If a Downward Adjustment Amount has occurredbeen determined and no Estimated Payment was made pursuant to Section 1.04(e), then (A) first, the Retention Amount shall be reduced and credited to Buyer by an amount equal to the Downward Adjustment Amount, and (B) to the extent the Downward Adjustment Amount exceeds the Retention Amount (the "Excess Amount"), the Escrow Agent shall pay to Buyer from the Accounts Receivable/Inventory Holdback Amount by wire transfer of immediately available funds the Excess Amount; provided further that if the Downward Adjustment Amount exceeds $20,000,000, Seller shall pay to Buyer by wire transfer of immediately available funds such excess amount up to an amount not to exceed $5,000,000. Any Retention Amount remaining Adjustment Escrow Funds after the reduction thereto pursuant to subclause (A) above shall instead be released paid by Buyer to Seller by wire transfer of immediately available funds.
(iv) If the Downward Adjustment Amount is less than the sum of Retention Amount and held in a Estimated Payment (such shortfall being herein referred to as the "Required Refund"), then (A) if the Required Refund is less than or equal to the Estimated Payment then Buyer shall pay to the Escrow Agent for deposit account subject into the Accounts Receivable/Inventory Holdback Amount by wire transfer of immediately available funds an amount equal to a control agreement in favor the Required Refund or (B) if the Required Refund is greater than the Estimated Payment then Buyer shall (x) pay to the Escrow Agent for deposit into the Accounts Receivable/Inventory Holdback Amount by wire transfer of immediately available funds an amount equal to the Estimated Payment and (y) pay to Seller from the Retention Amount an amount equal to the excess of the Consenting NoteholdersRequired Refund over the Estimated Payment by wire transfer of immediately available funds. Notwithstanding anything to the contrary contained herein, Buyer agrees that under no circumstance shall Escrow Agent release any of the Escrow Amount to Buyer to satisfy any amounts owed to Buyer in respect of the Downward Adjustment Amount except as otherwise permitted pursuant to Section 9.04(b). Any payment by Seller, the Escrow Agent or Buyer required by this subsection (c) for shall bear interest at the sole purpose rate equal to the interest being earned on the Accounts Receivable/Inventory Holdback Amount pursuant to the Post Closing Escrow Agreement from the Closing Date until the date of complying with mandatory repurchase requirements set forth payment. The Additional Purchase Price or the Downward Adjustment Amount, as the case may be (excluding payments attributable to interest), will be treated by the parties as an increase or decrease, as the case may be, in the Senior Secured Notes Supplemental Indenture with respect Purchase Price.
(d) The allocation for tax purposes of the Purchase Price will be agreed upon by the parties prior to any remaining 2025 Notesthe Closing.
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Post-Closing Adjustment. (a) Within ninety (90) 180 days following after the Closing Date, Buyer shall, or shall cause the Company to, Purchaser will prepare and deliver to the Seller a statement written notice (the “Adjustment Notice”) containing (i) an unaudited balance sheet of the Seller as of the close of business on the Closing Date (the “Closing StatementBalance Sheet”), (ii) setting forth its the Purchaser’s calculation of the Cash Consideration Closing Net Working Capital based on the Closing Balance Sheet and each reflecting the exclusion of the components thereofExcluded Assets and Excluded Liabilities (the “Final Closing Net Working Capital”) and (iii) the Purchaser’s calculation of the amount of any payments required pursuant to Section 2.7(e) (the “Adjustment Calculation”). The Closing Statement shall Balance Sheet will be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting PrinciplesGAAP, and the books and records of Purchaser shall have caused the Company and Closing Balance Sheet to have been reviewed or audited by its Subsidiariesindependent public accounting firm. During the thirty (30) days immediately following Seller’s Upon receipt of the Closing StatementAdjustment Calculation, the Company shall provide Seller and/or its attorneys or accountants will have the right upon not less than two (2) business days prior written notice and its representatives with reasonable access, during normal business hours to inspect and after reasonable advance notice, copy any or all of Purchaser’s records related to the books Closing Balance Sheet, the Final Closing Net Working Capital and the Adjustment Calculation, including all accountant work papers. Any inspection of Purchaser’s records requested by the Seller Representative shall be conducted at the expense of the Company Sellers, and Purchaser shall provide in advance (at no cost to Sellers except for purposes reasonable copying and mailing costs) copies of their review all accounting reports of Purchaser bearing on the Closing Statement. The Closing Statement subject and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsrelated accountants work papers.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation Within 30 days after delivery of the Cash Consideration shall become final and binding upon Adjustment Notice, the parties on Seller will deliver to the earlier of Purchaser a written response in which the Seller will either:
(i) the date any and all matters specified in the Notice of Disagreement are finally resolved agree in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth Adjustment Calculation, in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for which case such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become will be final and binding on the parties hereto, if not already mutually agreed for purposes of Section 2.7(e); or
(ii) dispute the Adjustment Calculation by ▇▇▇▇▇ and Seller, on delivering to the date Purchaser a written notice (a “Dispute Notice”) setting forth in reasonable detail the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of basis for each such disputed matters), item and certifying that all such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerdisputed items are being disputed in good faith.
(c) If the Cash Consideration Seller fails to take either of the foregoing actions within 30 days after delivery of the Adjustment Notice, then the Seller will be deemed to have irrevocably accepted the Adjustment Calculation, in which case, the Adjustment Calculation will be final and binding on the parties for purposes of Section 2.7(e).
(d) If the Seller timely delivers a Dispute Notice to the Purchaser, then the Purchaser and the Seller will attempt in good faith, for a period of 30 days, to agree on the Adjustment Calculation for purposes of Section 2.7(e). Any resolution by the Purchaser and the Seller during such 30-day period as to any disputed items will be final and binding on the parties for purposes of Section 2.7(e). If the Purchaser and the Seller do not resolve all disputed items by the end of 30 days after the date of delivery of the Dispute Notice, then the Purchaser and the Seller will resolve the remaining items in dispute in accordance with Section 2.9 below.
(e) If the Final Closing Net Working Capital as finally determined pursuant to this Section 2.7 is less than $3,000,000, then the Seller will pay to the Purchaser the amount of such difference in cash less the amount, if any, of any reduction in the Initial Purchase Price pursuant to Section 2.6(b) above. If the Final Closing Net Working Capital as finally determined pursuant to this Section 2.7 is greater than $3,000,000, then the Estimated Cash Consideration and Purchaser will pay to the Fundamental Change Repurchase Date (as Seller the amount of such term is defined difference in cash less the amount, if any, of any increase in the Senior Secured Notes IndentureInitial Purchase Price pursuant to Section 2.6(b) has not yet occurred, within five above.
(5f) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a Any payment to the Note Escrow Account Purchaser pursuant Section 2.7(e) may be satisfied in the first instance by amounts deposited in escrow in connection with the determination of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up Closing Net Working Capital pursuant to an Section 2.6(b) and, any payment amount in excess equal to the amount of the Adjustment Escrow Amount) such escrow deposit shall be effected by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal account designated by the Purchaser. Any payment to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c2.7(e) (if any) will be effected by wire transfer of immediately available funds for purposes to an account designated by the Seller. Such payments will be made within five business days following the final determination of making an offer to repurchase the 2026 Notes and the 2025 Notes Final Closing Net Working Capital in accordance with this Section 1.82.7.
(g) The purpose of this Section 2.7 is to determine the final Initial Purchase Price to be paid by the Purchaser under this Agreement. Accordingly, any adjustment pursuant hereto will neither be deemed to be an indemnification pursuant to Article 9, nor preclude the Purchaser from exercising any indemnification rights pursuant to Article 9; provided, however, that if in no event will the Fundamental Change Repurchase Date has occurredSeller or the Shareholders be obligated to indemnify any Purchaser Indemnified Party for any Loss as a result of, or based upon or arising from, any Liability, to the remaining Adjustment Escrow Funds shall instead extent, but only to the extent, such Liability is reflected in the calculation of the Final Closing Net Working Capital as finally determined pursuant to this Section 2.7. Any payment made pursuant to this Section 2.7 will be released treated by the parties for all purposes as an adjustment to Seller (the Initial Purchase Price and held in a deposit account will not be subject to a control agreement in favor of the Consenting Noteholders) offset for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesreason.
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Post-Closing Adjustment. (a) Within ninety As promptly as practicable after the Closing Date (90but in no event more than sixty (60) days following after the Closing Date), Buyer shall, or the Purchaser shall cause the Company to, prepare and deliver to Seller the Sellers a statement balance sheet of the Subject Company as of the close of business on the day immediately preceding the Closing Date (the “"Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereofBalance Sheet"). The Closing Statement shall Balance Sheet will be prepared in good faith in accordance with GAAP, applied on a basis consistent with the terms of this Agreement, including, as applicable, the Accounting Principles, Balance Sheet. The Sellers and the books Sellers' Accountant will be entitled to access to all relevant records and records working papers of the Subject Company to aid in the review of the Closing Balance Sheet. The Sellers will be solely responsible for all costs of the Sellers' Accountant. The Closing Balance Sheet shall be deemed to be accepted by and its Subsidiaries. During shall be conclusive for the purposes of the adjustment described in Section 2.5(b) hereof with respect to the Sellers except to the extent, if any, that the Sellers shall have delivered, within thirty (30) days immediately following Seller’s receipt of after the date on which the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, Balance Sheet is delivered to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (Sellers, a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant Purchaser stating each and every item to this Section 1.5(a) shall specify which the Sellers take exception as not being in accordance with GAAP applied on a basis consistent with the Balance Sheet or as having computational errors, specifying in reasonable detail the nature and amount extent of any disagreement so asserted such exception (it being understood that any amounts not disputed shall be paid promptly). If a change proposed by the Sellers is disputed by the Purchaser then the Purchaser and attach documentation supporting Seller’s calculationsthe Sellers shall negotiate in good faith to resolve such dispute. If, after a period of twenty (20) days following the date on which the Sellers give the Purchaser notice of any such proposed change, any such proposed change still remains disputed, then the Purchaser and the Sellers shall together choose an independent firm of public accountants of nationally recognized standing (the "Accounting Firm") to resolve any remaining disputes. The Accounting Firm shall act as an arbitrator to determine, based solely on presentations by the Sellers and the Purchaser and not by independent review, only those issues still in dispute. The decision of the Accounting Firm shall be final and binding and shall be in accordance with the provisions of this Section 2.5(a). All of the fees and expenses of the Accounting Firm, if any, shall be paid by the Purchaser and the Sellers in the proportions that the Accounting Firm's determination of Adjusted Working Capital Equity Deficiency bears to the Adjusted Working Capital Equity Deficiency proposals submitted by the parties to the Accounting Firm; provided, however, that, if the Accounting Firm determines that either party's position is totally correct, then the other party shall pay one hundred percent (100%) of the costs and expenses incurred by the Accounting Firm in connection with any such determination.
(b) If a timely Notice of Disagreement In the event that there is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter an Adjusted Working Capital Deficiency (as defined below). The Closing Statement , the Sellers shall be revised pay to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writingPurchaser, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (adjustment to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e.Consideration, not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount Adjusted Working Capital Deficiency. Any payments required to be made by which the Cash Consideration exceeds the Estimated Cash Consideration Sellers pursuant to this Section 2.5(b) shall be made within ten (up to an excess equal to 10) days after the amount of the Adjustment Escrow AmountAdjusted Working Capital Equity Deficiency has been determined pursuant to Section 2.5(a) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to account designated by the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow AccountPurchaser.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Stock Purchase Agreement (Corporate Staffing Resources Inc)
Post-Closing Adjustment. The Aggregate Consideration shall be subject to adjustment after the Closing Date as specified in this Section 1.7.
(a) Within ninety (90) days following the Closing DateEffective Time, Buyer ADAC shall, or shall cause PriceWaterhouseCoopers LLP or any successor accountant appointed by ADAC ("ADAC'S ACCOUNTANT") to, audit the Company's books to determine the accuracy of the information set forth on the Closing Financial Certificate (the "POST-CLOSING AUDIT"). The parties acknowledge and agree that, for purposes of determining the net worth of the Company to, prepare and deliver to Seller a statement (the “Closing Statement”) setting forth its calculation as of the Cash Consideration and each Closing Date, the value of the components thereofassets of the Company shall, except with the prior written consent of ADAC, be calculated as provided in the second sentence of Section 5.12. The Closing Statement Sellers shall be prepared in good faith in accordance cooperate and shall use their reasonable efforts to cause the officers and employees of the Company to cooperate with the terms of this Agreement, includingADAC or ADAC's Accountant, as applicable, after the Accounting PrinciplesClosing Date in furnishing information, documents, evidence and other assistance to ADAC or ADAC's Accountant, as applicable, to facilitate the completion of the Post-Closing Audit within the aforementioned time period. Without limiting the generality of the foregoing, within two (2) weeks after the Closing the Sellers, through the Sellers' Representative, as defined in Section 1.13, shall provide ADAC or ADAC's Accountant, as applicable, with the information and/or documents reasonably requested by ADAC or ADAC's Accountant, as the case may be, in order to facilitate the completion of the Post-Closing Audit by ADAC or ADAC's Accountant, as the case may be, within the aforementioned time period. In the event that ADAC or ADAC's Accountant determines that the actual Company net worth, calculated in accordance with GAAP consistently applied, and as modified in accordance with Schedule II (the books and records "ACTUAL COMPANY NET WORTH"), as of the Closing Date was less than the Certified Closing Net Worth, ADAC shall deliver a written notice (the "FINANCIAL ADJUSTMENT NOTICE") to the Sellers' Representative setting forth (i) the determination made by ADAC or ADAC's Accountant, as applicable, of the Actual Company Net Worth and its Subsidiaries(ii) the maximum amount that the Aggregate Consideration could have been reduced pursuant to Section 1.6(b) had the Actual Company Net Worth been reflected on the Closing Financial Certificate instead of the Certified Closing Net Worth (the "AGGREGATE CONSIDERATION ADJUSTMENT"). During The Aggregate Consideration Adjustment shall take account of the reduction, if any, to the Aggregate Consideration already taken pursuant to clause (i) of Section 1.6(b).
(b) The Sellers' Representative shall have thirty (30) days immediately following Seller’s from the receipt of the Closing StatementFinancial Adjustment Notice to notify ADAC if the Shareholders dispute such Financial Adjustment Notice. If ADAC has not received notice of such a dispute within such 30-day period, ADAC shall be entitled to receive from the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records shareholders of the Company for purposes (which may, without limitation, at ADAC's sole discretion, be offset against any Contingent Merger Amount or Contingent Payment Amount (as defined in Section 9.10) or recovered from the Escrow Amount) the Aggregate Consideration Adjustment. If, however, the Sellers' Representative has delivered notice of their review of the Closing Statement. The Closing Statement such a dispute to ADAC within such 30-day period, then ADAC and the resulting calculation Sellers' Representative shall mutually select in good faith an independent accounting firm that has not represented any of the Cash Consideration shall become final and binding upon the parties hereto within the preceding two (2) years to review the Company's books, the Closing Financial Certificate, the Financial Adjustment Notice and related information to determine the amount, if any, of the Aggregate Consideration Adjustment. The independent accounting firm shall be directed to consider only those books, records, agreements, contracts, commitments or other documents (or summaries thereof) that were either (i) delivered or made available to ADAC or ADAC's Accountant in connection with the transactions contemplated hereby, or (ii) reviewed by ADAC or ADAC's Accountant, as applicable, during the course of the Post-Closing Audit. The independent accounting firm shall make its determination of the Aggregate Consideration Adjustment, if any, within thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statementselection. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing The determination by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller Aggregate Consideration Adjustment shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become be final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Sellerupon such determination, on ADAC shall be entitled to receive from the date shareholders of the Arbiter delivers its final determination in writing to Buyer and Seller Company (which final determination shall may, without limitation, at ADAC's sole discretion, be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30offset against any Contingent Merger Amount or Contingent Payment Amount or recovered from the Escrow Amount) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealableAggregate Consideration Adjustment. The fees and expenses costs of the Arbiter pursuant to this Section 1.5(b) independent accounting firm shall be borne by the party (either ADAC or the Shareholders as a group) whose determination of the Company's net worth, on the one handcalculated in accordance with GAAP consistently applied, and Selleras modified in accordance with Schedule II, on the other hand, based upon the percentage which the aggregate portion as of the contested amount not awarded to Buyer Closing was further from the determination of the independent accounting firm, or equally by ADAC and Sellerthe Shareholders in the event that the determination by the independent accounting firm is equidistant between the Certified Closing Net Worth and the Actual Company Net Worth; PROVIDED, respectivelyHOWEVER, bears to that if ADAC's determination of the aggregate amount actually contested by such party. For exampleCompany's net worth, if Seller claims calculated in accordance with GAAP consistently applied, and as modified in accordance with Schedule II, as of the Cash Consideration is $1,000 greater Closing was further from the determination of the independent accountant than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 Certified Closing Net Worth or equidistant with the Certified Closing Net Worth from the determination of the amount claimed independent accountant (and not closer), in each case because of any book, record, agreement, contract, commitment or other document (or summary thereof) that was either not (i) delivered or made available to ADAC or ADAC's Accountant in connection with the transactions contemplated hereby or (ii) reviewed by SellerADAC or ADAC's Accountant, and if as applicable, during the Arbiter ultimately resolves the dispute by awarding Seller $300 course of the $500 contestedPost-Closing Audit, then the costs and expenses Shareholders shall bear the full cost of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerindependent accounting firm.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Merger Agreement (Adac Laboratories)
Post-Closing Adjustment. (a) After the Closing Date, the Seller and the Purchaser shall cooperate with each other and provide each other with such access to their respective books, records and relevant employees (and those of the Acquired Company) as they may reasonably request in connection with the matters addressed in this Section 2.05; provided that no Party shall be obligated to deliver any accountant work papers the delivery of which has not been consented to by such accounting firm. Within ninety (90) days following after the Closing Date, Buyer shall, or the Purchaser shall cause the Company to, prepare and deliver to the Seller a statement (the “Closing Purchaser’s Statement”) setting forth (i) its calculation of the Cash Consideration and each of Purchase Price (including the components thereof. The Closing Statement shall be prepared Date Net Working Capital Adjustment Amount, calculated in good faith in accordance a manner consistent with the terms of this Agreement, including, as applicable, the Accounting PrinciplesExample Calculation, and the books and records PJM Incremental Capacity Adjustment Amount) prepared in a manner consistent with the preparation of the Company Payment Schedule together with reasonable supporting information and its Subsidiaries. During calculations and (ii) and the Purchaser’s calculation of the adjustment in Section 2.05(d).
(b) The Seller shall have thirty (30) days immediately following Sellerfrom the date on which the Purchaser’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, Statement is delivered to the books and records of Seller (the Company for purposes of their “Review Period”) to review of the Closing Purchaser’s Statement. The Closing Statement and Unless the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and Purchaser on or before the resulting calculation last day of the Cash Consideration shall become final Review Period that it objects to any item or items shown or reflected on the Purchaser’s Statement, and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify specifying in reasonable detail the nature item or items to which it objects and amount of any disagreement so asserted reasons therefor (such item or items, the “Disputed Items” and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Sellersuch notice, the “Dispute Notice”), then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Purchaser’s Statement shall be revised deemed accepted by the Parties and the calculations set forth therein shall be deemed accepted by the Purchaser and the Seller for all purposes of determining the payments in Section 2.05(d). In the event of a delivery of a Dispute Notice by the Seller, senior executives of the Seller, on the one hand, and the Purchaser, on the other hand, shall attempt to the extent necessary to reflect resolve their differences arising from any Disputed Items, and any resolution agreed by them in writing shall be final, binding and conclusive for all purposes of determining the payments in Section 2.05(d). In the event that, for any reason, such senior executives are unable to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter amicably resolve all their differences in accordance with this Section 1.5. During the thirty writing within fifteen (3015) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer the Purchaser and the Seller may agree in writing) following the receipt of a Dispute Notice (the “Resolution Period”), Buyer any remaining Disputed Items not agreed in writing shall be referred to PricewaterhouseCoopers LLP (“PWC”). If PWC is unwilling or unable to serve as the Independent Accountant, each of the Seller and Seller shall submit any the Purchaser will jointly select and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to retain a nationally-nationally recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ not the auditor or independent accounting firm of any of the Parties who is a certified public accountant and Seller is independent of the Parties and impartial to serve as the Independent Accountant (PWC or such other Person engaged to resolve any Disputed Items pursuant to this Section 2.05, the “ArbiterIndependent Accountant”). If after fifteen (15) for review and resolution. Buyer and days after the date PWC informs the Parties that it is unable or unwilling to serve as the Independent Accountant, the Seller shall instruct the Arbiter to, and the ArbiterPurchaser cannot mutually agree on an Independent Accountant, acting either the Seller or the Purchaser may request the American Arbitration Association to appoint as an expert and the Independent Accountant, within fifteen (15) days from the date of such request or as soon as practicable thereafter, a partner in a nationally recognized accounting firm that is not an arbitrator, shall make a final determination the auditor or independent accounting firm of any of the items included in Parties, who is a certified public accountant and who is independent of the Closing Statement (Parties and impartial. If, for any reason, the Purchaser and the Seller are unable to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not agree on the basis Disputed Items within the Resolution Period, each of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by BuyerPurchaser, on the one hand, or and the Seller, on the other hand, or less than shall prepare separate written reports of such Disputed Items and deliver such reports to the smallest value for Independent Accountant within twenty (20) days after the later of the expiration of the Resolution Period and the date the Independent Accountant is retained. The Parties shall use their respective reasonable efforts to cause the Independent Accountant to, acting as an expert, as soon as practicable and in any event within thirty (30) days after receiving such written reports, determine the manner in which the Disputed Items shall be treated in the Purchaser’s Statement; provided, however, that the dollar amount of each item assigned in dispute shall be determined within the range of dollar amounts proposed by Buyerthe Purchaser, on the one hand, or and the Seller, on the other hand. The Closing Statement Parties acknowledge and agree that (i) the review by and determination of the Independent Accountant shall be limited to the unresolved Disputed Items contained in the reports prepared and submitted to the Independent Accountant by the Purchaser and the resulting calculation Seller and (ii) the determinations by the Independent Accountant shall be based solely on such reports submitted by the Purchaser and the Seller and the basis for the Purchaser’s and the Seller’s respective positions. The Parties shall not authorize the Independent Accountant to modify or amend any term or provision of this Agreement or modify items previously agreed among the Parties. The Purchaser and the Seller each agree to enter into an engagement letter with the Independent Accountant containing customary terms and conditions for this type of engagement. The Purchaser and the Seller shall use their commercially reasonable efforts to cooperate with and provide information and documentation, including work papers, to assist the Independent Accountant. Any such information or documentation provided by any Party to the Independent Accountant shall be concurrently delivered to the other Party, subject, in the case of independent accountant work papers, to such other Party entering into a customary confidentiality and release agreement with respect thereto. Neither the Purchaser nor the Seller shall disclose to the Independent Accountant, and the Independent Accountant shall not consider for any purposes, any settlement discussions or settlement offers made by any of the Cash Consideration Parties with respect to any Disputed Item. The determinations by the Independent Accountant as to the Disputed Items shall become final be in writing, shall include the Independent Accountant’s basis for such determinations and shall be an expert determination that is final, binding on and conclusive for all purposes of determining the parties heretoadjustments in Section 2.05(d), if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters)any, and such final determination may be entered and enforced in any court of competent jurisdiction. The Purchaser and the Seller shall each be liable for and pay one-half of the fees and other costs charged by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerIndependent Accountant.
(c) No later than the fifth (5th) Business Day immediately following the resolution of all Disputed Items (or, if there is no dispute, promptly after the Parties reach agreement on the Purchaser’s Statement), the Purchaser shall revise the Purchaser’s Statement to reflect the resolution of any Disputed Items (as so revised, the “Final Purchaser’s Statement”) and shall deliver a copy thereof to the Seller. The Seller shall have five (5) Business Days from the date on which the Final Purchaser’s Statement is delivered to it to review the Final Purchaser’s Statement solely for purposes of confirming that such statement accurately reflects the prior resolution of all matters set forth in the Dispute Notice either by mutual agreement of the Parties or by the Independent Accountant, as applicable; provided that the Seller shall be deemed to have accepted the Final Purchaser’s Statement if the Seller does not object within such five (5) Business Day period. The calculation of the Closing Date Net Working Capital Adjustment Amount set forth in the Final Purchaser’s Statement and the amount of any adjustment pursuant to Section 2.05(d), once accepted by the Seller in the manner provided by the preceding sentence, shall be referred to as the “Final Statement.”
(d) If the Cash Consideration is greater than Purchase Price, as finally determined as provided in Section 2.05(b) and Section 2.05(c) (as agreed between the Parties or as determined by the Independent Accountant, as applicable, and reflected in the Final Statement), (i) exceeds the Estimated Cash Consideration and Purchase Price, then the Fundamental Change Repurchase Date (as Purchaser shall pay the Seller an amount equal to the amount of such term is defined in the Senior Secured Notes Indenture) has not yet occurredexcess, within five (5) Business Days after the Closing Statement becomes final such amounts are finally agreed or determined pursuant to Section 2.05(b) and binding in accordance with the terms hereofSection 2.05(c), the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and account designated in the 2025 Notes in accordance with Section 1.8; providedPayment Schedule, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds (ii) is less than the Estimated Cash Consideration (up to Purchase Price, then the Seller shall pay the Purchaser an excess amount equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Considerationsuch shortfall, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (such amounts are finally agreed or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer determined pursuant to Section 1.5(c2.05(b) (if any) and Section 2.05(c), by wire transfer of immediately available funds for purposes of making to an offer account designated in writing by the Purchaser or (iii) is equal to repurchase the 2026 Notes and the 2025 Notes in accordance with Estimated Purchase Price, then no payment shall be made pursuant to this Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes2.05.
Appears in 1 contract
Sources: Membership Interest Purchase Agreement (Dynegy Inc.)
Post-Closing Adjustment. (a) Within ninety (90) Promptly after the Closing ----------------------- Date, Seller will prepare and, within 30 days following of the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller Buyer a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each Portion of the components thereofPurchase Price based on a balance sheet of the relevant items as of the Closing Date (the "Final Balance Sheet"), together with Supporting Schedules thereto. The Closing Statement Final Balance Sheet shall be prepared in good faith in accordance with generally accepted accounting principles consistently applied and as though the terms of parties had not consummated the transactions contemplated by this Agreement. Following the Closing, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of either (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. pay Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which decrease, if any, between the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount Portion of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase Purchase Price as reflected on the 2026 Notes and Final Balance Sheet or the 2025 Notes in accordance Adjusted Final Balance Sheet, as the case may be, as compared with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount Portion of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after Purchase Price as reflected on the Closing Statement becomes final and binding in accordance with the terms hereof, Balance Sheet or (ii) Buyer and the shall pay Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser increase, if any, between the Cash Portion of the Purchase Price as reflected on the Final Balance Sheet or the Adjusted Final Balance Sheet, as the case may be (the payment referred to in clause (i) an amount or (ii) above shall be referred to as the "Post-Closing Adjustment") as compared with the Cash Portion of the Purchase Price as reflected on the Closing Balance Sheet. Such payments shall be made by wire transfer or certified or bank cashier's check within ten (10) business days of adoption of the Final Balance Sheet or the notice from the Accounting Firm of the Adjusted Final Balance Sheet, as the case may be. No payment shall be made by either party if the Cash Portion of the Purchase Price as reflected on the Closing Balance Sheet is equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor Portion of the Consenting Noteholders) for Purchase Price as reflected on the sole purpose of complying with mandatory repurchase requirements set forth in Final Balance Sheet or the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesAdjusted Final Balance Sheet, as the case may be.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety (90) days following After the Closing Date, Seller and Buyer shallshall cooperate and provide each other access to their respective books, or records and employees (and those of the Project Companies) as are reasonably requested in connection with the matters addressed in this Section 2.6. Within 45 days after the Closing Date, Seller shall cause determine the Company toAdjusted Net Working Capital and Major Maintenance Amount as of the Closing and shall provide Buyer with written notice of such determination, prepare along with reasonable supporting information and deliver to Seller a statement calculations (the “Closing StatementSeller’s Determination”).
(b) setting forth its calculation If Buyer objects to Seller’s Determination, then it shall provide Seller written notice thereof within 20 days after receiving Seller’s Determination. If the Parties are unable to agree on the Adjusted Net Working Capital or Major Maintenance Amount, in each case as of the Cash Consideration Closing, within 90 days after the Closing Date, the Parties shall refer such dispute to Ernst and each Young LLP or, if that firm declines to act as provided in this Section 2.6(b), another firm of independent public accountants, mutually acceptable to Buyer and Seller, which firm shall make a final and binding determination as to all matters in dispute (and only such matters) on a timely basis and promptly shall notify the components thereofParties in writing of its resolution. The Closing Statement Such firm shall be prepared in good faith in accordance with not have the terms power to modify or amend any term or provision of this Agreement, including, as applicable. Each Party shall bear and pay one-half of the fees and other costs charged by such accounting firm. If Buyer does not object to Seller’s Determination within the time period and in the manner set forth in the first sentence of clause (b) or if Buyer accepts Seller’s Determination, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Adjusted Net Working Capital as set forth in Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration Determination shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and Parties for all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerpurposes hereunder.
(c) If the Cash Consideration Adjusted Net Working Capital or the Major Maintenance Amount, in each case as of the Closing (as agreed between the Parties or as determined by the above-referenced accounting firm or otherwise) is greater than or less than the Estimated Cash Consideration and ANWC Estimate or the Fundamental Change Repurchase Date (MM Estimate, as such term is defined in the Senior Secured Notes Indenture) has not yet occurredapplicable, then Buyer shall pay Seller, or Seller shall pay Buyer, respectively, within five (5) 10 Business Days after the Closing Statement becomes final and binding in accordance with the terms hereofsuch amounts are agreed or determined, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making to an offer to repurchase account designated by the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurredpayee, the amount by which difference between such amounts plus interest thereon at the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after Interest Rate from the Closing Statement becomes final Date through and binding in accordance with including the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) date of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Accountsuch payment.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Post-Closing Adjustment. (a) Within As soon as practicable, but no later than ninety (90) days following the Closing Date, Buyer shall, or Purchaser shall cause the Company to, prepare and deliver to Seller Seller, a statement (the “Preliminary Closing Statement”) setting forth a balance sheet of Company as of the Closing Date and including its good faith calculation of the Cash (i) Closing Indebtedness, (ii) Working Capital at Closing (the “Closing Working Capital”), (iii) final Transaction Expenses at Closing, (iv) Final Working Capital Adjustment (as determined in accordance with Section 2.9(f)), and (v) the Final Closing Consideration and (defined in Section 2.9(e)), which statement will include reasonable supporting documentation of Purchaser’s calculation of each of the components thereofforegoing amounts. The worksheets and data used by the Purchaser to prepare the Preliminary Closing Statement shall be delivered to the Seller concurrent with the delivery of the Preliminary Closing Statement. The Preliminary Closing Statement will be prepared in good faith in accordance with the terms Working Capital Principles and in a manner consistent with the Estimated Closing Statement.
(b) Seller shall have sixty (60) days to review the Preliminary Closing Statement from the date of this Agreement, including, as applicable, delivery thereof by Purchaser to Seller (the Accounting Principles, and the books and records of the Company and its Subsidiaries“Review Period”). During the thirty (30) days immediately following Seller’s receipt of the Closing StatementReview Period, the Company Purchaser shall provide Seller and its representatives Representatives with reasonable access, access during normal business hours and after reasonable advance notice, notice to the books books, records and records other documents (including work papers, schedules, financial statements and memoranda) of Purchaser and the Company for purposes of their review of the Preliminary Closing Statement. The Closing Statement and the resulting calculation If Seller objects to any aspect of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Preliminary Closing Statement, Seller delivers must deliver a written notice of its disagreement objection (a the “Notice of DisagreementObjection Notice”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, Purchaser on or prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing StatementReview Period. Any The Objection Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify any adjustment to the Preliminary Closing Statement that is objected to in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s the calculations.
(bc) If a timely Seller delivers an Objection Notice of Disagreement is delivered by Seller, then to Purchaser prior to the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation expiration of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ Review Period, Purchaser and Seller and (ii) the date any and all matters specified in the Notice shall, for a period of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following thereafter (the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing“Resolution Period”), Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified the matters contained in the Notice of Disagreementsuch Objection Notice, and all such discussions and communications related thereto shall (unless otherwise agreed to in writing by ▇▇▇▇▇ Purchaser and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer state rule, and Seller may agree in writing)any written resolution, Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected signed by ▇▇▇▇▇▇▇▇▇ and Seller, as to any such matter shall be final, binding, conclusive and non-appealable for all purposes hereunder. Except to the extent properly challenged in an Objection Notice, or in the event Seller does not, prior to the expiration of the Review Period, deliver an Objection Notice to Purchaser, Seller shall be deemed to have agreed to the Preliminary Closing Statement in its entirety, which Preliminary Closing Statement or undisputed portions thereof (as the “Arbiter”case may be) shall be final, binding, conclusive and non-appealable for review all purposes hereunder.
(d) If, at the conclusion of the Resolution Period, Purchaser and resolution. Buyer Seller have not reached an agreement with respect to all disputed matters contained in the Objection Notice, then as soon as practical but within ten (10) Business Days thereafter, Purchaser and Seller shall instruct submit for resolution those matters remaining in dispute (such matters, the Arbiter to, and “Disputed Matters”) to the Arbiter, acting Neutral Accountant. The Neutral Accountant shall act as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement arbiter to resolve (to the extent such amounts are in dispute) based solely on the written submissions by ▇▇▇▇▇ presentations of Purchaser and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an by independent review)) only the Disputed Matters. Buyer Purchaser and Seller shall cooperate with direct the Arbiter during Neutral Accountant to render a resolution of all such Disputed Matters within thirty (30) days after its engagement or such other period agreed upon in writing by Purchaser and Seller. In deciding any matter, the term Neutral Accountant shall be bound by the provisions of its engagement. Buyer this Section 2.9(d) and Seller shall instruct the Arbiter may not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned claimed by Buyer, on the one hand, Purchaser or Seller, on the other hand, Seller or less than the smallest value for such item assigned claimed by Buyer, on the one hand, Purchaser or Seller, on . If issues are submitted to the other hand. The Closing Statement Neutral Accountant for resolution: (i) the Seller and the resulting calculation Purchaser shall furnish or cause to be furnished to the Neutral Accountant such work papers and other documents and information relating to the Disputed Matters as the Neutral Accountant may request and are available to that party or its agents and shall be afforded the opportunity to present to the Neutral Accountant relating to the Disputed Matters and to discuss the issues with the Neutral Accountant (including explicitly providing such party’s calculations of the Cash Consideration Disputed Matters); and (ii) the determination by the Neutral Accountant, as set forth in a notice to be delivered to both the Seller and the Purchaser within sixty (60) days of the submission to the Neutral Accountant of the issues remaining in dispute, shall become final be final, binding and binding conclusive on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission used in the calculations of such disputed matters), and such final determination by the Arbiter Disputed Matters. Purchaser shall not be subject to court review or otherwise appealable. The pay a portion of the fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount Neutral Accountant equal to one hundred percent (100%) multiplied by a fraction, (i) the amount by numerator of which is the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the dollar amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, Disputed Matters that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement are resolved in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash ConsiderationSeller, and (ii) the Adjustment Escrow Fundsdenominator of which is the total dollar amount of the Disputed Matters. Seller shall pay that portion of the fees and expenses of the Neutral Accountant that Purchaser is not required to pay hereunder. For example, should the items in each casedispute total in amount to $1,000 and the Neutral Accountant awards $600 in favor of the Seller’s position, from sixty percent (60%) of the Adjustment Escrow Account.
costs of its review would be borne by the Purchaser and forty percent (d40%) Within five (5) Business Days after of the Closing Statement becomes costs would be borne by the Seller. The Neutral Accountant shall, as part of its final and binding determination, specify the allocation of fees in accordance with the terms hereof and if immediately preceding sentence. The resolution of the Fundamental Change Repurchase Date (as such term is defined Neutral Accountant shall be set forth in the Senior Secured Notes Indenture) has not yet occurred, Buyer a written statement delivered to Purchaser and Seller and, absent manifest error, shall cause the Escrow Agent (including by delivering joint written instructions be final, binding, conclusive and non-appealable for all purposes hereunder. Once modified and/or agreed to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred2.9(c) or this Section 2.9(d), the remaining Adjustment Escrow Funds Preliminary Closing Statement shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of become the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes“Final Closing Statement”.
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Post-Closing Adjustment. A post-closing adjustment to the Initial Purchase Price shall be made as follows.
(a) Within ninety sixty (9060) days following after the Closing Date, the Buyer shalland the Sellers, or together with their respective accountants, shall cause the Company to, prepare and deliver to Seller a statement (the “Closing Statement”i) setting forth its calculation an unaudited balance sheet of the Cash Consideration and each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, Business as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, Date reflecting the Company shall provide Seller total Acquired Assets and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records Assumed Liabilities of the Company for purposes of their review of Business and excluding the Closing Statement. The Closing Statement Excluded Assets and the resulting calculation of Excluded Liabilities (the Cash Consideration shall become final and binding upon the parties hereto thirty (30"CLOSING BALANCE SHEET") days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter Working Capital Adjustment (as defined belowhereinafter defined). The Buyer shall undertake reasonable efforts to cause the EMI Division monthly reporting package for the current month through the Closing Statement Date to be delivered to Hitachi promptly after the Closing. The Closing Balance Sheet shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter prepared in accordance with generally accepted accounting principles (subject to normal year-end adjustments consistent with prior periods) on a basis consistent with the balance sheet of the Business as of March 31, 1999 (the "BALANCE SHEET"). The Working Capital Adjustment shall become final for all purposes of this Section 1.5. During Agreement unless the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may the Sellers are unable to agree on the Working Capital Adjustment, in writing, which case the Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may Sellers agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to that a nationally-recognized mutually acceptable independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller of nationally recognized standing (the “Arbiter”"INDEPENDENT ACCOUNTANT") for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a the final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other handWorking Capital Adjustment. The Closing Statement and determination by the resulting calculation Independent Accountant of the Cash Consideration Working Capital Adjustment shall become final and be binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealableSellers. The fees and expenses of date on which the Arbiter Working Capital Adjustment is finally determined pursuant to this Section 1.5(b1.8(a) shall hereinafter be borne by referred to as the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party"WORKING CAPITAL SETTLEMENT DATE". For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, The Buyer and the Seller Sellers shall cause each bear the Escrow Agent (including by delivering joint written instructions to costs of their and their respective accountants' preparation of the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash ConsiderationClosing Balance Sheet, and (ii) each of such parties shall pay 50% of the Adjustment Escrow Funds, Independent Accountant's fees and expenses in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance connection with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with this Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
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Sources: Asset Purchase Agreement (Johnstown America Industries Inc)
Post-Closing Adjustment. (a) Within ninety (90) 20 days following after the end of each month that ends before the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver Seller will provide to Seller Purchaser a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration Estimated Pre-Closing Net Income for such month, together with such reasonably detailed data and calculations appropriate to support such statement. Purchaser shall have five Business Days after the receipt of each of such statement to provide Seller with Purchaser’s comments on such statement and the components thereof. The Closing Statement data and calculations set forth therein, which comments shall be prepared considered by Seller in good faith (and if revised by Seller in response to Purchaser’s comments, the revised statement shall be the statement of the Estimated Pre-Closing Net Income for such month). If Purchaser notifies Seller in writing that Purchaser is in agreement with the statement of Estimated Pre-Closing Net Income for any month, then the amount of Estimated Pre-Closing Net Income set forth in such statement shall be deemed to have been accepted and agreed upon as the Final Pre-Closing Net Income for such month for purposes of this Section 3.6. If Purchaser does not notify Seller in writing of its agreement with the statement of Estimated Pre-Closing Net Income for any month or notifies Seller of any objection to such statement, the Estimated Pre-Closing Net Income for such month shall be determined in accordance with the terms remainder of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations3.6.
(b) If a timely Notice of Disagreement is delivered by Seller, then At least five Business Days prior to the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration Date, Seller shall become final and binding upon the parties on the earlier deliver to Purchaser a proposed statement of (i) the date any and all matters specified in estimated Pre-Closing Net Income (the Notice “Estimated Pre-Closing Net Income”) as of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller immediately prior to the Closing Date and (ii) Seller’s proposed final calculation of the date any Estimated Pre-Closing Net Income Amount (such statement, the “Estimated Pre-Closing Net Income Statement”) together with such reasonably detailed data and all matters specified in calculations appropriate to support the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below)Estimated Pre-Closing Net Income Statement. The Estimated Pre-Closing Net Income Statement shall be revised to the extent necessary to reflect any resolution agreed to prepared by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller good faith and in accordance with GAAP, consistently applied, and shall be certified by the guidelines and procedures set forth in this Agreement (i.e., not Chief Financial Officer of the Company or other officer of the Company or Seller reasonably acceptable to Purchaser. Purchaser shall have until two Business Days prior to the Closing Date to provide Seller any comments on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Estimated Pre-Closing Net Income Statement and the resulting calculation data and calculations set forth therein, which comments shall be considered by Seller in good faith (and if revised by Seller in response to Purchaser’s comments, the revised statement shall be the statement of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed mattersEstimated Pre-Closing Net Income Statement), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If Purchaser does not object to the Cash Consideration is greater than determination of the Estimated Cash Consideration and Pre-Closing Net Income Amount as set forth on the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Estimated Pre-Closing Net Income Statement within five (5) Business Days 60 days after the Closing Date, the Estimated Pre-Closing Net Income Statement becomes final shall be deemed to have been accepted and binding agreed upon. If Purchaser objects to the Estimated Pre-Closing Net Income Amount set forth on the Estimated Pre-Closing Net Income Statement, Purchaser shall notify Seller of such objection and the basis for such objection, and Purchaser and Seller shall endeavor to resolve any such objection. If Seller and Purchaser are unable to resolve such objection within 30 days, the disputed item(s) shall be submitted to a neutral and impartial, nationally recognized certified public accounting firm for resolution in accordance with the terms hereofprocedures of Section 2.2(b)(iii). The Estimated Pre-Closing Net Income Amount, as it may be adjusted pursuant to Section 2.2(b)(iii) and this Section 3.6(c), shall be the Company shall, Final Pre-Closing Net Income Amount.
(d) On the third Business Day after Purchaser and Buyer shall cause the Company to, make a payment Seller agree (or have been deemed to agree) to the Note Escrow Account Final Pre-Closing Net Income Amount (or after Purchaser and Seller receive notice of any final determination of the Final Pre-Closing Net Income Amount pursuant to the procedures set forth in Section 2.2(b)(iii) and Section 3.6(c)), then (i) if the Final Pre-Closing Net Income Amount exceeds the Estimated Pre-Closing Net Income Amount, Purchaser shall pay to Seller an amount in cash equal to such excess and (ii) if the Estimated Pre-Closing Net Income Amount exceeds the Final Pre-Closing Net Income Amount, Seller shall pay to Purchaser an amount in cash equal to such excess, plus in each of cases (i) and (ii), interest on such amount from the Closing Date up to but excluding the date on which such payment is made at a rate per annum equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount Federal Funds Rate as of the Adjustment Escrow AmountClosing Date, calculated on the basis of a year of 360 days and the actual number of days elapsed. Any such payment under this Section 3.6(d) shall be made by federal funds wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount account(s) of the Adjustment Escrow AmountParty entitled to receive such payment, which account(s) shall instead be paid identified by Purchaser to Seller (and held in a deposit account subject or by Seller to a control agreement in favor Purchaser, as the case may be, as soon as practicable following the determination of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Final Pre-Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow AccountNet Income Amount.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety (90) As soon as practicable, but no later than 90 days following after the Closing Date, Buyer shall, or the KM Member shall cause the Company to, prepare and deliver to Seller the Buyer a written statement setting forth the KM Member’s good faith final calculation of the Purchase Price (the “Closing StatementFinal Purchase Price”) setting forth its based upon (a) the KM Member’s calculation of (i) Closing Working Capital and (ii) the Cash Consideration Working Capital Adjustment, in each case, together with reasonable supporting documents and each of the components thereof. The Closing Statement shall be prepared in good faith (x) on a basis consistent with GAAP, (y) in accordance with the terms principles and using the same line items set forth in Schedule 3.3(a) and (z) in accordance with the past practices of this Agreementthe Company; provided, includinghowever, as applicablethat in the event of a conflict between foregoing clauses (x), (y) and (z), Schedule 3.3(a) shall prevail, (b) the Long-Term Indebtedness Adjustment, together with reasonable supporting documents, and (c) the Interim Capital Contributions, together with reasonable supporting documents (collectively, the Accounting Principles“Final Closing Items”). Together with the Final Closing Items, the KM Member shall provide a worksheet showing the difference, if any, between any Estimated Closing Item and the corresponding Final Closing Item.
(b) The KM Member, the Buyer and the Company shall promptly provide to each other all documents reasonably requested by the other to verify any of the items set forth in the Final Closing Items calculations. The Buyer shall have the right for 30 days following receipt of the Final Closing Items to object to any item therein and the proposed calculation of the Final Purchase Price. The Buyer and its representatives shall be entitled to reasonable access during normal business hours to all books and records of the Company as may be reasonably requested by the Buyer for the purpose of this Section 3.4(b). Any objection made by the Buyer shall be made in writing and shall set forth such objection and the basis therefor in reasonable detail. The Buyer shall be deemed to have waived any rights to object under this Section 3.4(b) unless the Buyer furnishes its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, written objections to the books and records of KM Member within such 30 day period. If the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller Buyer delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to an objection within such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) 30 day period, then the Buyer and the KM Member shall negotiate in good faith for 15 days to resolve the objections. If, at the end of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify such 15-day period, there are any objections that remain in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Sellerdispute, then the Closing Statement (as revised remaining objections in accordance with this Section 1.5(b)) and dispute shall be submitted for resolution to the resulting calculation accounting firm of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇▇▇▇ LLP (the “Closing Item Arbitrator”). If any objections are submitted to the Closing Item Arbitrator for resolution, (i) each of the KM Member, the Buyer and Seller the Company shall promptly furnish to the Closing Item Arbitrator such workpapers and other documents and information relating to such objections as the Closing Item Arbitrator may request and are reasonably available to that Party (or its independent public accountants) and each of the KM Member and the Buyer will be afforded the opportunity to present to the Closing Item Arbitrator any final resolution determined material relating to the determination of the matters in dispute and to discuss such determination with the Closing Item Arbitrator; (ii) the Closing Item Arbitrator shall determine the Final Purchase Price as promptly as reasonably practicable following receipt of such workpapers and other documents and information; (iii) the Closing Item Arbitrator must not adopt an amount for any component of the Final Purchase Price that is greater than the greater amount submitted by the Arbiter KM Member or the Buyer or less than the lesser amount submitted by KM Member or the Buyer; and (iv) the determination by the Closing Item Arbitrator of the Final Purchase Price, as set forth in a written notice delivered to both the Buyer and the KM Member by the Closing Item Arbitrator, shall be made in accordance with this Section 1.5Agreement and shall be binding and conclusive on the Parties and, absent manifest error, shall constitute an arbitral award that is final, binding and unappealable and upon which a judgment may be entered by a court having jurisdiction thereof. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as The Buyer and Seller may agree in writing, Buyer the KM Member (on behalf of itself and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and SellerCompany) shall be governed by Rule 408 of each bear their own legal fees and other costs in connection with any such objection; provided that the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing)Buyer, Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter toon one hand, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or SellerKM Member, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation shall bear one-half of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) Closing Item Arbitrator. Notwithstanding anything in this Agreement to the Company contrary, the Closing Item Arbitrator and 40% (i.e., 200 ÷ 500) to Sellerprocedures set forth herein shall be the sole method for resolving any disputes regarding the Final Purchase Price or the provisions of this Section 3.4.
(c) Following the final determination of the Final Purchase Price pursuant to this Section 3.4, the following amount shall be promptly (but in any event within five Business Days of the determination of the Final Purchase Price) paid by wire transfer in immediately available funds to an account designated by the applicable payee as follows:
(i) If the Cash Consideration such finally determined Final Purchase Price is greater than the Estimated Cash Consideration Purchase Price, then the Buyer shall pay to the KM Member an amount in cash equal to the amount of such excess.
(ii) If such finally determined Final Purchase Price is less than the Estimated Purchase Price, then the KM Member shall pay to the Buyer an amount in cash equal to the amount of such shortfall.
(iii) If such finally determined Final Purchase Price is equal to the Estimated Purchase Price, then no payment to any Party shall be required. For the avoidance of doubt, no adjustment or payment pursuant to this Section 3.4(c) shall increase or decrease the KM Member’s or the Buyer’s relative holdings of Membership Interests. Any payments made pursuant to this Section 3.4(c) shall constitute an adjustment of the Purchase Price for Tax purposes and shall be treated as such by the Buyer, the KM Member and the Fundamental Change Repurchase Date Company on their Tax Returns.
(as d) If required by Schedule 3.4, the consideration for the SoCo Interest shall be further adjusted upwards by an amount equal to $50,000,000 (such term is defined in amount, the Senior Secured Notes Indenture) has not yet occurred“Deferred Consideration”), within five (5) Business Days after and the Closing Statement becomes final and binding Deferred Consideration, if any, shall be paid by the Buyer in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements conditions set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow AccountSchedule 3.4.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety As soon as practicable, but no later than sixty (9060) days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller the Seller, or any other Affiliate of Parent as designated by Parent, a statement (the “Closing Statement”) setting forth its Buyer’s calculation of (i) the Cash Consideration Closing Date Cash, (ii) the Closing Date Indebtedness, (iii) the Closing Date Working Capital, (iv) the Unpaid Transaction Expenses and each (v) the “Final Purchase Price”, which shall equal (A) the Base Payment, plus (B) the amount of the components thereofClosing Date Cash, minus (C) the amount of the Closing Date Indebtedness, and (D)(1) if the Closing Date Working Capital Adjustment is positive, plus, the Closing Date Working Capital Adjustment or (2) if the Closing Date Working Capital Adjustment is negative, minus, the absolute value of the Closing Date Working Capital Adjustment, minus (E) the Unpaid Transaction Expenses (collectively, (B) through (E), the “Post-Closing Adjustment”). The Buyer’s calculations set forth in the Closing Statement (collectively, the “Proposed Purchase Price Calculations”) shall be prepared in good faith in accordance delivered with reasonable supporting detail with respect to the terms calculation of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty such amounts.
(30b) Within forty-five (45) days immediately following Seller’s of receipt of the Closing Statement, the Company shall Parent may provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance disputing all or a part of the Proposed Purchase Price Calculations (such notice, a “Purchase Price Dispute Notice”). If Parent does not provide a Purchase Price Dispute Notice to Buyer within such 45-day period, then the parties agree that the Proposed Purchase Price Calculations set forth in the Closing StatementStatement shall be deemed final and binding on the parties hereto. Any Purchase Price Dispute Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify set forth in reasonable detail the nature basis for such disagreement, the amounts involved and amount of any disagreement so asserted and attach documentation Parent’s determination (in each case, with reasonable supporting Seller’s calculations.
(bdetail) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and Closing Date Cash, (ii) the date any Closing Date Indebtedness, (iii) the Closing Date Working Capital and all matters specified in (iv) the Unpaid Transaction Expenses. If a Purchase Price Dispute Notice of Disagreement not resolved by is provided to Buyer, then Buyer and Seller are finally resolved in writing by Parent shall use commercially reasonable efforts to resolve the Arbiter disputed items (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During “Disputed Items”) during the thirty (3030)-day period commencing on the date of Buyer’s receipt of the Purchase Price Dispute Notice.
(c) days immediately following the delivery of If Parent and Buyer do not agree upon a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have final resolution with respect to any matter specified Disputed Items within such 30-day period, then the remaining items in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) dispute shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement submitted immediately to a nationally-recognized mutually agreeable accounting firm to be determined by Parent and Buyer or, if such firm declines to be retained to resolve the dispute, another nationally recognized, independent accounting firm that is mutually selected by ▇▇▇▇▇ reasonably acceptable to Buyer and Seller Parent (in either case, the “ArbiterAccounting Firm”) for review and resolution). Buyer and Seller The Accounting Firm shall instruct the Arbiter to, and the Arbiter, acting act as an expert and not as an arbitrator, arbitrator and shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) any determinations based solely on the written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Sellerand Parent, on the other hand, and not by independent investigation. The parties agree to instruct the Accounting Firm to render a determination of the applicable dispute within forty-five (45) days after referral of the matter to such Accounting Firm, which determination must be in writing and must set forth, in reasonable detail, the basis therefor. The terms of appointment and engagement of the Accounting Firm shall be as agreed upon between Parent and Buyer, and any associated engagement fees shall be initially borne fifty percent (50%) by Parent and fifty percent (50%) by Buyer; provided that such fees shall ultimately be borne by Parent and Buyer in inverse proportion as they may prevail on matters resolved by the Accounting Firm, which proportionate allocations shall also be determined by the Accounting Firm at the time the determination of the Accounting Firm is rendered on the merits of the Disputed Items. For example, should the items in dispute total in amount to $1,000 and the Accounting Firm awards $600 in favor of Parent’s position, sixty percent (60%) of the costs of its review would be borne by Buyer and forty percent (40%) of the costs would be borne by Parent. Except as provided in the preceding sentence, all other costs and expenses incurred by the parties hereto in connection with resolving any dispute hereunder before the Accounting Firm shall be borne by the party incurring such cost and expense. In resolving the Disputed Items, the Accounting Firm (A) shall be bound by the provisions of this Section 2.07, (B) may not assign a value to any item greater than the greatest value claimed for such item or less than the smallest value for such item assigned claimed by Buyereither Buyer or Parent and (C) shall limit its decision to such items as are in dispute and to only those adjustments as are necessary for the Proposed Purchase Price Calculations to comply with the provisions of this Agreement. Such determination of the Accounting Firm shall be conclusive and binding upon the parties hereto absent fraud or manifest error.
(d) The parties agree that they will, on and agree to cause their respective Representatives to, cooperate and assist in the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final Final Purchase Price and binding on in the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on conduct of the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination review by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses Accounting Firm of any proposed calculations of the Arbiter pursuant to this Section 1.5(b) shall be borne by Final Purchase Price or the Companycomponents thereof, on including the one handmaking available, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For exampleextent necessary, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyerof books, records, work papers and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerpersonnel.
(ce) If the Cash Consideration Final Purchase Price is equal to or greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date Purchase Price, then Buyer shall promptly (as such term is defined but in the Senior Secured Notes Indenture) has not yet occurred, any event within five ten (510) Business Days after the Closing Statement becomes final and binding in accordance with date on which the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment Final Purchase Price is determined pursuant to this Section 2.07) pay to the Note Escrow Account Seller or any other Affiliate of Parent as designated by Parent an aggregate cash amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration such excess (up to an excess equal to the amount of the Adjustment Escrow Amount) if any), by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth or accounts as directed by Parent in the Senior Secured Notes Supplemental Indenture with respect Closing Notice (or such other accounts as Parent shall designate in writing to any remaining 2025 Notes. Buyer).
(f) If the Estimated Cash Consideration Purchase Price is greater than the Cash ConsiderationFinal Purchase Price, then the Seller shall promptly (but in any event within five ten (510) Business Days after the Closing Statement becomes final and binding in accordance with date on which the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions Final Purchase Price is determined pursuant to the Escrow Agentthis Section 2.07) to make payment pay to Buyer (or its designees) of an aggregate cash amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Considerationsuch excess, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds to the account or accounts as Buyer shall designate in writing to Parent.
(g) Any amount paid pursuant to this Section 2.07 shall be treated as an adjustment to the Final Purchase Price for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notestax reporting purposes.
Appears in 1 contract
Post-Closing Adjustment. (a) Within As soon as practicable, but in no event later than ninety (90) days following the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each of Closing Working Capital (the components thereof. The "Closing Statement shall Working Capital Statement"), the Closing Net Indebtedness (the "Closing Net Indebtedness Statement"), the Franchisee Adjustment Amount (the "Franchisee Adjustment Amount Statement"), the EBITDA Adjustment Amount, to the extent a variance from the Reference EBITDA Adjustment Amount is permitted to be prepared in good faith in accordance with claimed pursuant to the terms of this Agreement, including, as applicable, Section 6.13(f) (the Accounting Principles"EBITDA Adjustment Amount Statement"), and the books Capex Adjustment (the "Capex Statement", together with the Closing Working Capital Statement, the Closing Net Indebtedness Statement, the EBITDA Adjustment Amount Statement, if any, and records the Franchisee Adjustment Amount Statement, the "Calculation"). The Calculation shall also set forth the amount, if any, by which the calculation of the Purchase Price differs from the Estimated Purchase Price. The Calculation shall be set forth in sufficient detail to permit Seller to make any objections it may seek to have. Buyer shall cause a full closing of the financial statements in respect of the Company and its SubsidiariesSubsidiaries to occur for the period from July 1, 2002 to the Closing Date, calculated on the basis that the Closing was effective at 11:59 p.m. on the day prior to the Closing Date as if such date were a fiscal year end and such that the unaudited financial statements produced with respect to the period ended on the day prior to the Closing Date are similar in all material respects to the U.K. GAAP Company Financial Statements (the "Closing Date Financial Statements"). Seller shall, and shall cause Diageo and its Affiliates, to provide Buyer with reasonable access to data within its control to the extent necessary in connection with the preparation of the Calculation and the Closing Date Financial Statements. Buyer shall provide the unaudited Closing Date Financial Statements to Seller together with reasonable back-up documentation reasonably necessary to evaluate or understand the Closing Date Financial Statements and the Calculation at the time of delivery of the Calculation.
(b) During the thirty period of any review or dispute as provided in this Section 2.5, Buyer and Seller shall, and shall cause each of their Affiliates to: (30i) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller each other party and its representatives with reasonable accessaccess to its and its Affiliates' relevant books, during normal business hours records and after reasonable advance noticeemployees (to the extent any of such books, records or employees relate to the Calculation) and (subject, in the case of accountant or auditor work papers, to providing any customary confidentiality, hold harmless or other agreements reasonably requested by the books accountant or auditor) relevant work papers of accountants or auditors and records permit copies to be made of any of the Company foregoing documentation and (ii) cooperate fully with such other party and its authorized representatives, including the provision on a timely basis of all information relevant for purposes of their review the Calculation; provided that, without prejudice to any of Buyer's other rights under this Agreement, after the submission of the Closing Statement. The Closing Statement Calculation, Seller shall be required to provide such access and cooperation only to the resulting calculation extent relevant to items disputed by Seller pursuant to Section 2.5(c).
(c) After receipt of the Cash Consideration Calculation, Seller shall become final and binding upon the parties hereto thirty have sixty (3060) days following Seller’s receipt thereof unless to review the Calculation. Unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, on or prior to the expiration sixtieth (60th) day after Buyer's delivery of the thirty (30) day periodCalculation stating that Seller has objections to the Calculation, of written notice Seller shall be deemed to Buyer of its acceptance of have accepted and agreed to the Closing StatementCalculation. Any Notice of Disagreement delivered pursuant Matters included in the Calculation, which are not objected to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered writing by Seller, then the Closing Statement shall be deemed to be accepted by Seller (as revised in accordance with this Section 1.5(b)"Resolved Items") and the resulting calculation of the Cash Consideration any amounts included within such items shall become final be deemed to be final, binding and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved conclusive. If Seller notifies Buyer in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised its objections to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writingCalculation, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreementshall, and all such discussions related thereto within forty-five (unless otherwise agreed by ▇▇▇▇▇ and Seller45) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period days (or such longer period as Buyer and Seller may agree in writing) following such notice (the "Resolution Period"), attempt to resolve their differences, and any written resolution by them as to any disputed amounts shall be final, binding and conclusive.
(d) Any amounts remaining in dispute at the conclusion of the Resolution Period ("Unresolved Items") shall be submitted by Buyer and Seller to Deloitte and Touche LLP (such firm being referred to as the "CPA Firm") or, if such firm shall submit any be unable or unwilling to serve in such capacity or if Seller and all matters Buyer shall otherwise mutually agree in writing, such other nationally recognized firm of independent accountants mutually agreed in writing by Seller and Buyer (but only and, in such matters) which remain in dispute and which were properly included in case, such firm shall be deemed to be the Notice CPA Firm), within 10 days after the expiration of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Resolution Period or as soon as practicable after Buyer and Seller have engaged the CPA Firm. Seller and Buyer agree to use their commercially reasonable efforts to engage the CPA Firm as promptly as practicable. Each party agrees to execute, if requested by the CPA Firm, an engagement letter with the CPA Firm containing reasonable terms and to provide the CPA Firm such work papers and other documents and information related to the Unresolved Items as the CPA Firm may reasonably request if available to such party or its Affiliates (or their accountants or auditors). All fees and expenses relating to the work, if any, to be performed by the CPA Firm shall instruct be borne 50% by Buyer and 50% by Seller. The CPA Firm shall act as an arbitrator and not as an expert, to determine, based on the Arbiter toprovisions of this Section 2.5, only the Unresolved Items; provided, however, that the CPA Firm shall have authority to determine, and the Arbiterterm "Unresolved Items" as used in this Section 2.5 shall mean, acting as only the amount(s) of the Calculation and no other matter whatsoever, absent an expert express written agreement to the contrary by Buyer and not an arbitrator, Seller. Seller and Buyer shall make a final request that the CPA Firm provide its determination of the items included in Unresolved Items within 30 days after the submission of the Unresolved Items to the CPA Firm, and a calculation of the Closing Statement (to Working Capital Statement, the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with Closing Net Indebtedness Statement, the guidelines and procedures set forth in this Agreement (i.e.Capex Statement, not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing EBITDA Adjustment Amount Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other handFranchisee Adjustment Amount Statement, based upon the percentage which amount of Resolved Items and the aggregate portion CPA Firm's determination of the contested amount not awarded Unresolved Items, shall be set forth in a written statement delivered to Seller and Buyer by the CPA Firm and shall be final, binding and conclusive on Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(de) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date following either (as such term is defined in the Senior Secured Notes Indenturei) has not yet occurred, an agreement or deemed agreement by Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions as to the Escrow Agent) to make a payment from Closing Working Capital, the Closing Net Indebtedness, the Capex Adjustment, the EBITDA Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (Amount, if any, and the Franchisee Adjustment Amount, or (ii) after any payments are made the CPA Firm's determination of all Unresolved Items, Seller shall pay to Buyer the amount, if any, by which the Estimated Purchase Price exceeds the final calculation of the Purchase Price, or Buyer shall pay to Seller the amount, if any, by which the final calculation of the Purchase Price exceeds the Estimated Purchase Price (the "Post-Closing Adjustment").
(f) Any payments made pursuant to this Section 1.5(c) (if any) 2.5 shall be made by wire transfer of immediately available U.S. Dollar funds to an account indicated by the party to receive such funds and shall be accompanied by interest at the Applicable Rate calculated on the basis of a year of 365 days for purposes the actual number of making an offer days elapsed, accrued from the Closing Date up to repurchase and including the 2026 Notes and the 2025 Notes date of payment.
(g) Any payments made in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor respect of the Consenting Noteholders) Post-Closing Adjustment shall be deemed to be adjustments to the Base Purchase Price pursuant to Section 2.2, for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesall tax purposes.
Appears in 1 contract
Post-Closing Adjustment. (a) Within No sooner than sixty (60) days after the Closing Date, but no later than ninety (90) days following after the Closing Date, Buyer shall deliver to Seller a statement (the “Post-Closing Statement”) setting forth in reasonable detail Buyer’s good faith calculation of (i) the Adjustment Amount, including each component thereof, and (ii) the resulting calculation of the Final Purchase Price. Concurrently with the delivery of the Post-Closing Statement, Buyer shall deliver to Seller reasonable documentation in the possession of Buyer or any of its Affiliates to support the items for which adjustments are proposed or made in the Post-Closing Statement delivered by Buyer, and a brief explanation of any such adjustments and the reasons therefor. In the event Buyer does not deliver the Post-Closing Statement in accordance with this Section 2.7, Seller’s pre-Closing estimate of the Final Purchase Price shall control unless Seller elects to deliver a Post-Closing Statement within ten (10) Business Days after such ninetieth (90th) day, then the Parties shall proceed in accordance with Section 2.7(b) except that the rights of Seller and Buyer shall be reversed.
(b) Seller shall have forty-five (45) days after Seller’s receipt of the Post-Closing Statement (the “Review Period”) within which to review Buyer’s calculation of the Final Purchase Price. If Seller disputes any component of the proposed Final Purchase Price set forth in the Post-Closing Statement delivered pursuant to Section 2.7(a) (the “PC Statement Purchase Price”), Seller shall notify Buyer in writing of its objection to the PC Statement Purchase Price prior to the expiration of the Review Period, together with a description of the basis for and dollar amount of such disputed components (to the extent possible), together with reasonable documentation in the possession of Seller supporting such disputed components (a “Dispute Notice”). The PC Statement Purchase Price shall become final, conclusive and binding on the Parties, and be considered the Final Purchase Price for all purposes of this Agreement, unless Seller delivers to Buyer a Dispute Notice prior to the expiration of the Review Period. If Seller timely delivers a Dispute Notice, (i) any amounts in the PC Statement Purchase Price not objected to by Seller in the Dispute Notice shall be final, conclusive and binding on the Parties, and (ii) Buyer and Seller shall, within fifteen (15) days following Buyer’s receipt of such Dispute Notice (the “Resolution Period”), use commercially reasonably efforts to attempt to mutually resolve in writing their differences with respect to any remaining items set forth in the Dispute Notice and any such mutual resolution shall be final, conclusive and binding on the Parties.
(c) If, at the conclusion of the Resolution Period, any items set forth in the Dispute Notice remain in dispute (the “Remaining Disputes”), then each of Buyer and Seller shall submit all such Remaining Disputes to the Houston, Texas office of KPMG (or such other nationally recognized accounting firm the Parties may mutually select), for resolution; provided, that if KPMG has not confirmed that it will arbitrate such disputes and the Parties do not agree on another accounting firm within ten (10) days following the request from the Parties for KPMG to arbitrate such disputes, the Houston, Texas, office of the American Arbitration Association shall select a nationally recognized accounting firm not materially affiliated with Seller or Buyer to arbitrate such disputes. The appointed accounting firm shall be the “Accounting Firm”, and within five (5) Business Days after appointment of the Accounting Firm the Parties shall deliver to the Accounting Firm their written position with respect to such Remaining Disputes. The Accounting Firm, once appointed, shall have no ex parte communications with the Parties concerning the Remaining Disputes. The Accounting Firm shall determine, based solely on the submissions by Seller and Buyer, and not by independent review, only the Remaining Disputes and shall choose either Seller’s position or Buyer’s position with respect to each matter addressed in a Dispute Notice, in each case, in accordance with this Agreement. The Accounting Firm may not award damages, interest or penalties to any Party with respect to any matter. The Parties shall request that the Accounting Firm make a decision with respect to all Remaining Disputes within forty-five (45) days after the submission of the Remaining Disputes to the Accounting Firm, as provided above, and in any event as promptly as practicable. The final determination with respect to all Remaining Disputes shall be set forth in a written statement by the Accounting Firm delivered simultaneously to Seller and Buyer and shall, absent manifest error, be final, conclusive and binding on the Parties and enforceable against the Parties in any court of competent jurisdiction, without right of appeal. Buyer and Seller shall promptly execute any reasonable engagement letter requested by the Accounting Firm and shall each cooperate fully with the Accounting Firm, including, by providing the information, data and work papers used by each Party to prepare and/or calculate the Final Purchase Price, making its personnel and accountants available to explain any such information, data or work papers, so as to enable the Accounting Firm to make such determination as quickly and as accurately as practicable. The fees, costs and expenses of the Accounting Firm pursuant to this Section 2.7(b) shall be borne one half by Seller, on the one hand, and one half by Buyer, on the other hand.
(d) From and after the Closing Date until the Final Purchase Price is finally determined pursuant to this Section 2.7, Seller, its Affiliates and their auditors, accountants, counsel and other representatives shall be permitted reasonable access to the Target Group and its auditors, accountants, personnel, books and records and any other documents or information reasonably requested by Seller (including the information, data and work papers used by Buyer and/or the Target Group’s auditors or accountants to prepare and calculate the Final Purchase Price).
(e) If the Final Purchase Price exceeds the Closing Purchase Price (such excess amount, if any, the “Excess Amount”), within five (5) Business Days after the Final Purchase Price is finally determined pursuant to this Section 2.7, Buyer shall, or shall cause the Company to, prepare and deliver pay to Seller a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall be prepared Seller, in good faith in accordance with the terms of this Agreementimmediately available funds, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, an aggregate amount equal to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsExcess Amount.
(bf) If a timely Notice of Disagreement the Final Purchase Price is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for Closing Purchase Price (such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties heretoshortfall amount, if not already mutually agreed by ▇▇▇▇▇ and Sellerany, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters“Shortfall Amount”), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding Final Purchase Price is finally determined pursuant to this Section 2.7, Seller shall pay to Buyer, in accordance with the terms hereofimmediately available funds, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an aggregate amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Shortfall Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(dg) Within five Any payments made pursuant to this Section 2.7 shall be deemed an adjustment to the Purchase Price, to the extent permitted by applicable Law.
(5h) Business Days To satisfy its obligations pursuant to this Section 2.7, from and after the Closing Statement becomes Closing, and until the final determination of the Final Purchase Price (and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurredpayment, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any, thereof), Seller covenants and agrees to maintain at least Forty-Five Million Dollars ($45,000,000.00) after any payments are made of unrestricted cash and Cash Equivalents on its balance sheet to satisfy and pay to Buyer pursuant to Section 1.5(c) (the Shortfall Amount, if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety (90) 30 calendar days following after the Closing Date, Buyer shallBuyer, or shall cause with the Company toassistance of any necessary Almo and Seller personnel at no cost to Buyer, will prepare and deliver to Seller the Sellers a statement draft Closing Date Schedule 2.1 (the “"Draft Closing Statement”Date Schedule") setting forth its calculation for the Business as of the Cash Consideration and each close of business on the components thereofClosing Date. The Draft Closing Statement shall Date Schedule will be prepared in good faith in accordance the same manner as Schedule 2.1, with the terms of this Agreement, including, inventory reserve to be as applicable, the Accounting Principles, set forth on 1.3(e) and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, equipment value to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsbe as set forth on Schedule 1.2(d).
(b) If the Sellers have any objections to the Draft Closing Date Schedule, they will deliver a timely Notice of Disagreement is delivered by Seller, then detailed statement describing their objections to the Buyer within ten business days after receiving the Draft Closing Statement (as revised in accordance with this Section 1.5(b)) Date Schedule. The Buyer and the resulting calculation of the Cash Consideration shall become final and binding upon Sellers will use reasonable efforts to resolve any such objections themselves. If the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement do not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any obtain a final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) within ten calendar days immediately following from the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writingSellers' objections, Buyer and Seller may attempt the objections to resolve any differences which they may have with respect the Draft Closing Date Schedule will be submitted to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 Deloitte & Touche within seven days of the Federal Rules termination of Evidence and any applicable similar Law. At the end of such thirty (30) ten-day resolution period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement referred to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) above for review and binding resolution. The Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination will bear one-half of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant accounting firm, and the Sellers will bear the other one-half of the fees. Both parties will make their work papers and other materials available to this Section 1.5(b) the accounting firm. The determination of the accounting firm shall be borne by made within 30 days after the Companysubmission of the objections for resolutions, and the determination shall be conclusive, final, and binding on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerparties.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (The Purchase Price will be adjusted as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesfollows:
1. If the Estimated Cash Consideration book or agreed value of the Acquired Assets minus the book or agreed value of the Assumed Liabilities, as reflected on the agreed to (or resolved or determined) Draft Closing Date Schedule (the "Closing Date Schedule") plus $2,500,000, is greater less than the Cash Considerationcash amount paid by Buyer at the Closing, then Almo or the Sellers will pay to the Buyer within five (5) Business Days after three days of the agreement to the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer Date Schedule (or its designees) within three days of an amount equal to resolution, or determination by the lesser accounting firm, of (iany objections thereto) an amount equal to the difference between (A) the cash amount paid by which the Estimated Cash Consideration exceeds the Cash Consideration, Buyer minus $2,500,000 and (iiB) the Adjustment Escrow Fundsactual book or agreed value of the Acquired Assets minus the actual book or agreed value of the Assumed Liabilities as reflected on the agreed to (or resolved or determined) Draft Closing Date Schedule.
2. If the book or agreed value of the Acquired Assets minus the book or agreed value of the Assumed Liabilities, in each caseas reflected on the agreed to (or resolved or determined) Closing Date Schedule plus $2,500,000, from is more than the Adjustment Escrow Accountcash amount paid by Buyer at the Closing then the Buyer will pay to the Sellers within three days of the agreement to the Closing Date Schedule (or within three days of resolution, or determination by the accounting firm, of any objections thereto) an amount equal to the difference between (A) the book or agreed value of the Acquired Assets minus the book or agreed value of the Assumed Liabilities as reflected on the agreed to (or resolved or determined) Closing Date Schedule and (B) the cash amount paid by Buyer minus $2,500,000.
3. If the book or agreed value of the Acquired Assets minus the book or agreed value of the Assumed Liabilities, as reflected on the agreed to (or resolved or determined) Closing Date Schedule, is equal to the amount paid by Buyer minus $2,500,000 then there will be no adjustment to the Purchase Price.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions Any amounts required to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer be paid pursuant to Section 1.5(cSections 2.1(c) (if any) 1 or 2 above shall be paid by wire transfer of in immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesfunds.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety sixty (9060) days following after the Closing Date, Buyer shallSeller shall prepare, or shall cause the Company toto be prepared, prepare and deliver to Seller Buyer a working capital statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each CATV Business as of the components thereof. The Closing Statement Date, which statement shall be prepared in good faith in accordance with GAAP and in a manner consistent with the terms preparation of the 1996 Financial Statements, except as otherwise required by this Agreement, including, and shall set forth the Current Assets and Current Liabilities of Seller as applicable, of the Accounting Principles, Closing Date and the books Average Three Month Revenue (the "Preliminary Working Capital Statement"). Buyer shall cooperate in providing to Seller all relevant books, records and records personnel of the Company and its Subsidiaries. CATV Business in order to facilitate the preparation of the Preliminary Working Capital Statement.
(b) During the succeeding thirty (30) days immediately following Seller’s receipt day period, Buyer shall have the right to examine the Preliminary Working Capital Statement and all records used to prepare the Preliminary Working Capital Statement.
(c) In the event Buyer determines that the Preliminary Working Capital Statement has not been prepared on the basis set forth in Section 2.04(a) hereof, Buyer shall so inform Seller in writing (the "Buyer's Objection"), setting forth a reasonably specific description of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records basis of the Company for purposes of their review of Buyer's Objection on or before the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration last day of the thirty (30) day period, of written notice period referred to Buyer of its acceptance in Section 2.04(b) hereof. In the event of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by SellerBuyer's Objection, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by shall attempt to resolve the Arbiter (as defined below). The Closing Statement shall be revised to differences underlying the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the Buyer's Objection within thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Seller's receipt thereof. If Seller and Buyer and Seller may agree in writing, Buyer and Seller may attempt are unable to resolve any all their differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of within such thirty (30) day period (period, they shall refer their remaining differences to KPMG Peat Marwick, certified public accountants, or such longer period other nationally recognized firm of independent public accountants as to which Buyer and Seller may mutually agree in writing(the "CPA Firm"), who shall, acting as experts and not as arbitrators, determine on the basis of the standard set forth in Section 2.04(a) hereof and only with respect to the remaining differences so submitted, whether and to what extent, if any, the Preliminary Working Capital Statement requires adjustment. The CPA Firm will base its determination only on evidence brought to it by the parties and shall not conduct an audit, but may conduct such testing procedures as are customarily used to make such determination on the evidence brought to it. The CPA Firm shall deliver its written determination to Buyer and Seller no later than the twentieth (20th) business day after the remaining differences underlying the Buyer's Objection are referred to the CPA Firm. The CPA Firm's determination shall be conclusive and binding upon the parties. The fees and disbursements of the CPA Firm shall be allocated between Buyer and Seller in the same proportion that the aggregate amount of any disputed items submitted to the CPA Firm that are unsuccessfully disputed by each (as finally determined by the CPA Firm) bears to the total amount of any disputed items so submitted. Buyer and Seller shall submit make readily available to the CPA Firm all relevant books and records and any work papers relating to the Preliminary Working Capital Statement and all matters other items reasonably requested by the CPA Firm. The "Final Working Capital Statement" shall be (but only such mattersi) which remain in dispute and which were properly included the Preliminary Working Capital Statement in the Notice of Disagreement event that (x) the Buyer's Objection is not delivered to a nationally-recognized independent accounting firm that is mutually selected by Seller in the period set forth in Section 2.04(b) hereof, or (y) Seller and Buyer so agree; or (ii) the Preliminary Working ▇▇▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller▇, on as adjusted by either (x) the date the Arbiter delivers its final determination in writing to Buyer and agreement of Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration or (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (iiy) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow AccountCPA Firm.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Asset Purchase Agreement (Frontiervision Holdings Capital Corp)
Post-Closing Adjustment. (a) Within ninety Buyer shall prepare and deliver to the Seller, within sixty (9060) days following the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement setting forth Buyer’s good faith calculations (the “Closing StatementBuyer’s Proposed Calculations”) setting forth its calculation of (i)(A) the actual amount of the Cash Consideration and each Closing Indebtedness, (B) the actual amount of the components thereof. The Closing Statement shall be prepared Date Cash, (C) the actual amounts of the Net Working Capital and the Net Working Capital Adjustment, in good faith each case, calculated in accordance with the terms of this Agreement; (ii) the Final Purchase Price using the foregoing amounts; and (iii) the amount, includingif any, as applicableby which the Final Purchase Price so determined using the foregoing amounts for these purposes is greater than or less than the Estimated Purchase Price. Buyer’s Proposed Calculations shall include reasonable detail of the items constituting such Closing Indebtedness, the Accounting Principlessuch Net Working Capital and such Net Working Capital Adjustment. Following delivery by Buyer of Buyer’s Proposed Calculations, Buyer and the Company Group shall, upon reasonable prior written notice to Buyer, provide the Seller and its Representatives with reasonable access during normal business hours, in a manner that does not interfere with the business operations of Buyer, any member of the Company Group or any of their respective Affiliates, to the financial books and records of the Company and its Subsidiaries. During Group, in each case, solely to the thirty (30) days immediately following Seller’s receipt of extent related to the period prior to the Closing Statement, and solely for the Company shall provide purposes of allowing the Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, Representatives to confirm the books and records accuracy of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty Buyer’s Proposed Calculations.
(30b) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, On or prior to the expiration 45th day following B▇▇▇▇’s delivery of the thirty (30) day periodBuyer’s Proposed Calculations, of the Seller may deliver to Buyer a written notice stating the Seller’s objections to Buyer the Buyer’s Proposed Calculations (including each disputed item or amount) and the Seller’s calculation of its acceptance of each disputed amount (the Closing Statement“Objection Notice”). Any The Objection Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) objection and the resulting calculation of basis therefor. Any determination set forth in the Cash Consideration Buyer’s Proposed Calculations that is not specifically objected to in the Objection Notice shall become final be deemed accepted and shall be final, conclusive and binding upon the parties on Parties. If the earlier Seller does not deliver to Buyer the Objection Notice within such 45-day period, then the Buyer’s Proposed Calculations shall be final, conclusive and binding upon the Parties and the Buyer’s Proposed Calculations shall constitute the basis for the determination of the Final Purchase Price.
(ic) Following B▇▇▇▇’s receipt of the date Objection Notice, the Seller and B▇▇▇▇ shall attempt to negotiate in good faith to resolve any and all matters specified amounts disputed in the Objection Notice. In the event that the Seller and B▇▇▇▇ fail to agree on all of the Seller’s proposed disputed items set forth in the Objection Notice of Disagreement are finally resolved in writing by within thirty (30) days after Buyer receives the Objection Notice, the Seller and Buyer shall engage E▇▇▇ B▇▇▇▇▇ LLP or, if such Person is unable or unwilling to act as the Independent Accountant hereunder, such other nationally recognized accounting firm that is mutually acceptable to Buyer and the Seller and is willing to serve in such capacity hereunder (iithe “Independent Accountant”), to make the final determination of any remaining amounts in dispute (the “Disputed Amounts”) in accordance with the date any terms of this Agreement. Buyer and all matters specified in the Seller shall deliver to the Independent Accountant a copy of the Buyer’s Proposed Calculation and the Objection Notice and each of Disagreement not resolved Buyer and the Seller shall provide the Independent Accountant with their respective determinations of the Disputed Amounts and such other written submissions, presentations and supporting material as each of Buyer and the Seller deems necessary and appropriate. A copy of the written submissions, presentations and supporting materials provided by Buyer or the Seller, as applicable, to the Independent Accountant, shall be promptly delivered to the other Person, and Seller are finally resolved no Party or its Representatives shall be permitted to engage in any ex-party communications (whether written or oral) with the Independent Accountant. The Independent Accountant shall make a determination in writing by of each of the Arbiter Disputed Amounts as soon as reasonably practicable after its engagement, but no later than forty five (as defined below). The Closing Statement 45) days after being engaged, and such determination shall be, absent fraud or manifest error, final and binding on the Parties and shall be revised to within the extent necessary to reflect any resolution agreed to range proposed by ▇B▇▇▇▇ and the Seller or any final resolution determined in the Buyer’s Proposed Calculations and the Objection Notice for each of such Disputed Amount. The scope of the disputes to be resolved by the Arbiter Independent Accountant shall be limited to whether the calculation of a Disputed Amount was done in accordance with the terms hereof (including the applicable definitions of this Section 1.5. During the thirty (30Agreement) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified whether there were mathematical errors in the Notice calculation of Disagreementany of the Disputed Amounts, and all such discussions related thereto (unless otherwise agreed the Independent Accountant shall not to make any other determination. The Independent Accountant shall make its determination based solely on written submissions, presentations and supporting material provided by ▇B▇▇▇▇ and Seller) the Seller and not pursuant to any independent review, and such determination shall be governed by Rule 408 based upon the definitions of the Federal Rules of Evidence Closing Indebtedness and any applicable similar LawNet Working Capital. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller The Independent Accountant shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting act as an expert and expert, not an arbitrator. The fees, shall make a final determination costs and expenses of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller Independent Accountant shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by be allocated between Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which of the aggregate portion dollar value of the contested amount items set forth in the Objection Notice not awarded to Buyer and the Seller, respectively, bears to the aggregate amount actually contested by such partyParty. For example, if the Seller claims that the Cash Consideration is appropriate adjustments are in the aggregate $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, Buyer and if the Arbiter Independent Accountant ultimately resolves the dispute such items by awarding to the Seller $300 of the $500 1,000 contested, then the fees, costs and expenses of the Arbiter Independent Accountant will be allocated 6030% (i.e., 300 ÷ 5001,000) to the Company Buyer and 4070% (i.e., 200 700 ÷ 5001,000) to the Seller.
(c) If . During the Cash Consideration is greater than review by the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurredIndependent Accountant, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereofBuyer, the Company shall, Seller and Buyer their respective Representatives shall cause the Company to, make a payment reasonably available to the Note Escrow Account of an amount equal Independent Accountant such information, books and records and work papers as may be reasonably required by the Independent Accountant to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount fulfill its obligations under this Section 2.7(c). The Independent Accountant’s determination of the Adjustment Escrow Amount) by wire transfer of immediately available funds Disputed Amounts shall be treated as compromise and settlement negotiations for purposes of making an offer to repurchase Rule 408 of the 2026 Notes Federal Rules of Evidence and the 2025 Notes in accordance with Section 1.8; providedcomparable state rules of evidence, that if the Fundamental Change Repurchase Date has occurredand all negotiations, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal submissions to the amount Independent Accountant, and presentations under this Section 2.7(c) shall be treated as confidential information. The Independent Accountant shall be bound by a mutually agreeable confidentiality agreement. The decision rendered pursuant to this Section 2.7(c) may be filed as a judgment in any court of competent jurisdiction. Either Party may seek specific enforcement or take other necessary legal action to enforce any decision under this Section 2.7(c). The other Party’s only defense to such a request for specific enforcement or other legal action shall be fraud by or upon the Independent Accountant or manifest error by the Independent Accountant. Absent such fraud or manifest error, such other Party shall reimburse the Party seeking enforcement for all of its expenses related to the enforcement of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow AccountIndependent Accountant’s determination.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Sources: Equity Purchase Agreement (Xtant Medical Holdings, Inc.)
Post-Closing Adjustment. (a) The Cash Purchase Price shall be subject to adjustment after the Closing Date as specified in this Section 1.3.
(b) Within ninety one hundred twenty (90120) days following the Closing Date, Buyer shallBuyer, or at its option, shall cause PriceWaterhouseCoopers ("Buyer's Accountant") to audit the Company to, prepare and deliver Company's books to Seller a statement determine the accuracy of the information set forth on the Closing Financial Certificate (the “"Post-Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereofAudit"). The Closing Statement shall be prepared in good faith in accordance with parties acknowledge and agree that for purposes of determining the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records net worth of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt as of the Closing StatementDate, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified value of the assets of the Company shall, except with the prior written consent of Buyer, be calculated as provided in the Notice last paragraph of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller Section 6.9 and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement net worth shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter calculated in accordance with this Section 1.51.2(b). During In the thirty (30) days immediately following event that Buyer's Accountant determines that the delivery of a Notice of Disagreement or such longer period actual Company net worth as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or Date was less than the smallest value for such item assigned Certified Closing Net Worth, Buyer shall deliver a written notice (the "Financial Adjustment Notice") to the Stockholders' Representative, as defined in Section 1.6, setting forth (i) the determination made by Buyer's Accountant of the actual Company net worth (the "Actual Company Net Worth"), on (ii) an explanation in reasonable detail of all calculations made by the one handBuyer's Accountant in connection with determining the Actual Company Net Worth, or Sellerincluding supporting work papers which shall be made available in Santa Ana, on California, (iii) the other hand. The Closing Statement and the resulting calculation amount of the Cash Consideration shall become final and binding Purchase Price that would have been payable at Closing pursuant to Section 1.2(c) had the Actual Company Net Worth been reflected on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on Closing Financial Certificate instead of the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters)Certified Closing Net Worth, and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b(iv) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds Purchase Price would have been reduced at Closing had the Estimated Cash Consideration Actual Company Net Worth been used in the calculations pursuant to Section 1.2(c) (up to an excess equal the "Purchase Price Adjustment"). The Purchase Price Adjustment shall take account of the reduction, if any, to the amount Cash Purchase Price already taken pursuant to Section 1.2(c)(i). In the event that the Buyer's Accountant determines that there is a Net Worth Excess (as defined in Section 1.2(b)(i)), then the terms and conditions of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount1.2(b)(ii) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Accountgovern.
(dc) Within five The Stockholders' Representative shall have sixty (560) Business Days after days from the Closing Statement becomes final and binding in accordance with receipt of the terms hereof and Financial Adjustment Notice to notify Buyer if the Fundamental Change Repurchase Date Stockholders dispute such Financial Adjustment Notice. If Buyer has not received notice of such a dispute within such sixty (60) day period, Buyer shall be entitled to receive from the Stockholders (which may, at Buyer's sole discretion, be from the Pledged Assets as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.1.4)
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Post-Closing Adjustment. (ai) Within As soon as practicable, but no later than ninety (90) days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement (the “Closing Statement”) setting forth its Buyer’s calculation of (A) the ▇▇▇▇▇ Closing Date Cash, (B) the ▇▇▇▇▇ Closing Date Indebtedness, (C) the ▇▇▇▇▇ Net Working Capital Adjustment Amount, (D) the Transaction Expenses and based thereon, Buyer’s calculation of the Cash Consideration and each of ▇▇▇▇▇ Final Purchase Price. Buyer’s calculations set forth in the components thereof. The Closing Statement (the “Proposed Purchase Price Calculations”) shall be prepared in good faith in accordance delivered with reasonable supporting detail with respect to the terms calculation of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty such amounts.
(30ii) Within forty-five (45) days immediately following Seller’s of receipt of the Closing Statement, Seller may provide written notice to Buyer disputing all or a part of the Company shall provide Seller and its representatives Proposed Purchase Price Calculations only on the basis of (x) mathematical errors in the Proposed Purchase Price Calculations or (y) that the Proposed Purchase Price Calculations were not prepared in accordance with reasonable access, during normal business hours and after reasonable advance Section 1.3(d) (such notice, a “Purchase Price Dispute Notice”). If Seller does not provide a Purchase Price Dispute Notice to Buyer within such forty-five (45)-day period, then the books and records of parties agree that the Company for purposes of their review of Proposed Purchase Price Calculations set forth in the Closing Statement. The applicable Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon on the parties hereto thirty (30) days following Seller’s receipt thereof unless hereto. If a Purchase Price Dispute Notice is provided to Buyer, then Buyer and Seller delivers written notice of its disagreement (a “Notice of Disagreement”) shall use reasonable efforts to Buyer prior to such date; provided that resolve the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of disputed items during the thirty (30) day period, 30)-day period commencing on the date of written notice to Buyer of its acceptance Buyer’s receipt of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsPurchase Price Dispute Notice.
(biii) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement Buyer do not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any agree upon a final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any disputed items within such thirty (30)-day period, then the remaining items in dispute shall be submitted immediately to the Chicago office of Ernst & Young LLP, or, if such firm declines to be retained to resolve the dispute, another nationally recognized, independent accounting firm reasonably acceptable to Buyer and Seller (in either case, the “Accounting Firm”). The parties agree to instruct the Accounting Firm to render a determination of the applicable dispute within forty-five (45) days after referral of the matter specified to such Accounting Firm, which determination must be in writing and must set forth, in reasonable detail, the basis therefor. The terms of appointment and engagement of the Accounting Firm shall be as agreed upon between Seller and Buyer, and any associated engagement fees shall be initially borne 50% by Seller and 50% by Buyer; provided that such fees shall ultimately be borne by Seller and Buyer in inverse proportion as they may prevail on matters resolved by the Accounting Firm, which proportionate allocations shall also be determined by the Accounting Firm at the time the determination of the Accounting Firm is rendered on the merits of the disputed items. Except as provided in the Notice of Disagreementpreceding sentence, all other costs and all expenses incurred by the parties hereto in connection with resolving any dispute hereunder before the Accounting Firm shall be borne by the party incurring such discussions related thereto cost and expense. In resolving the disputed items, the Accounting Firm (unless otherwise agreed by ▇▇▇▇▇ and SellerA) shall be governed bound by Rule 408 the provisions of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty this Section 1.3, (30B) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value claimed for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned claimed by Buyer, on the one hand, either Buyer or Seller, (C) shall rely solely on the other handwritten submissions of the parties and shall not conduct an independent investigation and (D) shall limit its decision to such items as are in dispute and to only those adjustments as are necessary for the Proposed Purchase Price Calculations to comply with the provisions of this Agreement. Such determination of the Accounting Firm will be deemed an award in arbitration and shall be conclusive and binding upon the parties hereto.
(iv) The Closing Statement parties agree that they will, and agree to cause their respective independent accountants and their respective Subsidiaries to, cooperate and assist in the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ Final Purchase Price and Seller, on in the date conduct of the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested review by the Accounting Firm of any proposed calculations of the ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters)Final Purchase Price or the components thereof, and such final determination by including the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Companymaking available, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For exampleextent necessary, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyerof books, records, work papers and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerpersonnel.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(dv) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with date on which the terms hereof and ▇▇▇▇▇ Final Purchase Price is determined pursuant to this Section 1.3(c):
(1) if the Fundamental Change Repurchase Date (as such term ▇▇▇▇▇ Final Purchase Price is defined in greater than the Senior Secured Notes Indenture) has not yet occurred▇▇▇▇▇ Estimated Purchase Price, Buyer and shall pay to Seller shall cause the Escrow Agent (including or other parties designated by delivering joint written instructions to the Escrow Agent) to make Seller, a payment from the Adjustment Escrow Account to the Note Escrow Account of an cash amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) such excess, by wire transfer of immediately available funds for purposes to the Seller Designated Account(s) (or such other accounts as Seller shall designate in writing to Buyer), or
(2) if the ▇▇▇▇▇ Estimated Purchase Price is greater than the ▇▇▇▇▇ Final Purchase Price, Seller or its designees shall pay to Buyer a cash amount equal to such deficiency, by wire transfer of making immediately available funds to an offer account that Buyer designates in writing to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8Seller; provided, however that if to the Fundamental Change Repurchase Date has occurred, extent any portion of the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject amounts payable as reflected on the Closing Statement is not disputed pursuant to a control agreement in favor Purchase Price Dispute Notice, such undisputed portion shall be paid by the applicable party within five (5) Business Days after receipt of the Consenting NoteholdersPurchase Price Dispute Notice.
(vi) Any amount paid pursuant to this Section 1.3(c) shall be (A) increased by an amount calculated as interest on such amount, compounded daily, at the Applicable Rate from the Closing Date to and including the date of payment based on a 365-day year, (B) made by wire transfer of immediately available funds to an account designated by the receiving party and (C) treated as an adjustment to the ▇▇▇▇▇ Final Purchase Price for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notestax reporting purposes.
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Post-Closing Adjustment. (a) Within ninety As soon as practicable following the Closing, but not later than one hundred twenty (90120) days following thereafter, the Closing Date, Buyer Sellers shall, or shall cause with the Company tocooperation and assistance of Buyer, prepare and deliver or cause to Seller a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms Accounting Principles an unaudited statement of this Agreement, including, as applicable, the Accounting Principles, and the books and records Net Assets of the Company and its Subsidiaries. During Industrial Power Transmission Business at the thirty Closing Date (30) days immediately following Seller’s receipt the "CLOSING DATE STATEMENT OF NET ASSETS"), which Closing Date Statement of Net Assets shall contain a statement of the Closing StatementNet Assets (or from which the Closing Net Assets can be calculated), the Company and shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review cause a copy of the Closing Statement. The Closing Date Statement and the resulting calculation of the Cash Consideration Net Assets to be delivered to Buyer.
(b) Buyer shall become final and binding upon the parties hereto have thirty (30) days following Seller’s receipt thereof unless Seller delivers delivery of the Closing Date Statement of Net Assets (the "OBJECTION PERIOD") to provide written notice to the Sellers (the "OBJECTION NOTICE") of its disagreement (a “Notice any good faith objection to any portion of Disagreement”) to Buyer prior to such date; provided that the Closing Date Statement and of Net Assets relating to the resulting calculation of the Cash Consideration Closing Net Assets, which objection shall become be set forth with reasonable detail in such Objection Notice. Unless Buyer timely delivers an Objection Notice before the expiration of the Objection Period, the Closing Date Statement of Net Assets (and the Closing Net Assets reflected thereon or calculated therefrom) shall be deemed to have been accepted and approved by Buyer and shall thereafter be final and binding upon Buyer for purposes of any post-closing adjustment set forth in this Section 2.5 (and any amounts to be paid pursuant to Section 2.5(g) hereof shall thereupon be paid). In addition, to the extent any portion of the Closing Date Statement of Net Assets or of the calculation of the Closing Net Assets shall not be objected to in the Objection Notice, such matters shall be deemed to have been accepted and approved by Buyer and shall be final and binding upon Buyer for purposes hereof (and any amounts to be paid pursuant to Section 2.5(g) hereof shall thereupon be paid). If Buyer timely delivers an Objection Notice before the expiration of the Objection Period, then those aspects of the Closing Date Statement of Net Assets objected to in the Objection Notice shall not thereafter be final and binding until resolved in accordance with this Section 2.5.
(c) Following receipt of any Objection Notice, the Sellers and Buyer shall discuss in good faith the applicable objections set forth therein for a period of sixty (60) days thereafter and shall, during such period, attempt to resolve the matter or matters in dispute by mutual written agreement. If the parties reach such an agreement, such agreement shall be confirmed in writing and shall revise the Closing Date Statement of Net Assets to reflect such agreement, which agreement (and the Closing Date Statement of Net Assets, as so revised, including the Closing Net Assets reflected thereon or calculated therefrom) shall thereafter be final and binding upon the parties upon Seller’s delivery, prior Sellers and Buyer for purposes of any post-closing adjustment set forth in this Section 2.5 (and any amounts to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered be paid pursuant to this Section 1.5(a2.5(g) hereof shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsthereupon be paid).
(bd) If the parties are unable to reach a timely Notice of Disagreement is delivered by Sellermutual agreement in accordance with Section 2.5(c) hereof during the sixty (60) day period referred to therein, then the Closing Statement (as revised in accordance with this Section 1.5(b)) Sellers and Buyer shall jointly select the resulting calculation New York office of one of the Cash Consideration shall become final five (5) largest United Stated independent public accountants (other than PricewaterhouseCoopers, LLP and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of (the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing"ACCOUNTING EXPERT"), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiterwho, acting as an expert and not as an arbitrator, shall resolve those matters still in dispute with respect to the Closing Date Statement of Net Assets and the Closing Net Assets reflected thereon or calculated therefrom. If the parties fail to agree on an Accounting Expert within five (5) business days after the expiration of the sixty (60) day period, either party may request the American Arbitration Association to appoint such an Accounting Expert (or another accounting firm if all five accounting firms decline to or are disqualified from accepting the dispute), and such appointment shall be conclusive and binding upon the parties. The Accounting Expert's resolution of the matters in dispute, including any adjustments to the Closing Date Statement of Net Assets (or the Closing Net Assets reflected thereon or calculated therefrom) made by the Accounting Expert, shall be final and binding on the Sellers and Buyer (and any amounts to be paid pursuant to Section 2.5(g) hereof shall thereupon be paid). The Accounting Expert shall make a final determination as soon as practicable and in any event within sixty (60) days (or such other time as the parties shall agree in writing) after its engagement. Notwithstanding anything set forth in this Section 2.5(d), the scope of any dispute to be resolved by the items included in Accounting Expert pursuant to this Section 2.5(d) shall be limited to whether the Closing Date Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and of Net Assets was prepared in accordance with the guidelines Accounting Principles or whether there were errors of fact or mathematical errors in the Closing Date Statement of Net Assets or the calculation of the Closing Net Assets.
(e) The Sellers and Buyer agree that any adjustments made pursuant to this Section 2.5 shall be made without regard to materiality. Notwithstanding any other provision of this Agreement, including without limitation any provision stating that remedies shall be cumulative and not exclusive, this Section 2.5 provides the sole and exclusive method for resolving any and all disputes of each and every nature whatever that may arise between or among the parties with respect to the purchase price adjustment. The Sellers and Buyer further agree on their own behalf and on behalf of their respective affiliates and Representatives that if one or more of them should initiate any attempt to resolve any such dispute or disputes in any manner other than the sole and exclusive manner set forth in this Section 2.5, such initiators shall pay and reimburse all fees, costs and expenses incurred by any other party as a result of, in connection with or related to such attempt or attempts. This Section 2.5(e) shall not preclude Buyer from seeking indemnification pursuant to Section 9.4(a) with respect to any untruth or inaccuracy of any representation or warranty made by the Sellers in this Agreement, except to the extent that such matter was previously resolved pursuant to the procedures set forth in this Agreement Section 2.5.
(i.e., not on f) The Final Purchase Price shall be calculated based upon the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting final calculation of the Cash Consideration Closing Net Assets as determined in this Section 2.5 and shall become be calculated at the time the Closing Date Statement of Net Assets (and the Closing Net Assets reflected thereon or calculated therefrom) becomes final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b2.5. If the Closing Net Assets as reflected on or calculated from such final and binding Closing Date Statement of Net Assets:
(i) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears are greater than or equal to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contestedPreliminary Net Assets, then the costs and expenses Final Purchase Price shall be equal to (A) the Purchase Price (without giving effect to any adjustment pursuant to Section 2.4 hereof), PLUS (B) the amount, if any, by which the Closing Net Assets exceeds the Preliminary Net Assets; or
(ii) are less than the Preliminary Net Assets, then the Final Purchase Price shall be equal to (A) the Purchase Price (without giving effect to any adjustment pursuant to Section 2.4 hereof), MINUS (B) the amount by which the Preliminary Net Assets exceeds the sum of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerClosing Net Assets.
(cg) If the Cash Consideration Final Purchase Price (i) is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurredPurchase Price, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment pay to the Note Escrow Account of an amount equal to Sellers the amount by which the Cash Consideration Final Purchase Price exceeds the Estimated Cash Consideration Purchase Price, or (up to an excess equal to ii) is less than the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurredEstimated Purchase Price, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) Sellers shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment pay to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration Purchase Price exceeds the Cash ConsiderationFinal Purchase Price (the amount of either such adjustment, a "POST-CLOSING ADJUSTMENT AMOUNT"). Any Post-Closing Adjustment Amount payable by either party pursuant to this Section 2.5(g) shall be paid promptly by the party required to pay such Post-Closing Adjustment Amount, but in no event later than ten (10) business days following the determination of such Post-Closing Adjustment Amount. Payment by either party of any Post-Closing Adjustment Amount shall be made in immediately available funds via wire transfer to an account designated by the party entitled to receive such payment in writing and shall be paid together with interest thereon from and including the Closing Date, but excluding the date of payment, at a variable rate per annum equal to the "Prime Rate" as reported from time to time in THE WALL STREET JOURNAL (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account"INTEREST RATE").
(dh) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor Each of the Consenting Noteholders) for parties hereto agrees that the sole purpose of complying with mandatory repurchase requirements set forth the post-closing adjustment to the Purchase Price contemplated by this Section 2.5 is to measure the effect of operating activities and transactions that have occurred between the date of the Interim Statement of Net Assets and the Closing. This post-closing adjustment is not intended to permit the introduction of different judgments, accounting methods, policies, practices, procedures or estimation methods for the purpose of determining the amount of Closing Net Assets and preparing the Closing Date Statement of Net Assets from those used in determining the amount of Preliminary Net Assets and preparing the Interim Statement of Net Assets. Notwithstanding anything else in this Section 2.5 to the contrary, to the extent that a disagreement relates to an error in the Senior Secured Notes Supplemental Indenture with respect Closing Date Statement of Net Assets and a similar error exists in the Interim Statement of Net Assets, then if the Closing Net Assets is reduced or increased as a result of such error, the Preliminary Net Assets shall also be reduced or increased, as appropriate, to reflect such error, and as a result thereof, only the difference between the Preliminary Net Assets (as so adjusted) and the Closing Net Assets (as so adjusted) shall be the post-closing adjustment contemplated by this Section 2.5.
(i) All fees and expenses of the Sellers relating to the matters described in this Section 2.5, including the preparation and delivery of the Closing Date Statement of Net Assets, shall be borne by the Sellers, and all fees and expenses of Buyer relating to the matters described in this Section 2.5 shall be borne by Buyer. Notwithstanding the foregoing, in the event any remaining 2025 Notesdispute is submitted to the Accounting Expert for resolution as provided in Section 2.5(d) hereof, the fees and expenses of the Accounting Expert (and any arbitrator appointing such expert, if applicable) shall be borne equally by the Sellers and Buyer.
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Post-Closing Adjustment. (aA) Within ninety (90) Parent shall cause to be prepared and, as soon as practical, but in no event later than 75 days following after the Closing Date, Buyer shall, or shall cause to be delivered to the Company toRepresentative, prepare and deliver to Seller a statement (the “Closing Statement”) setting forth its containing the actual amounts of Closing Cash, Closing Indebtedness, Closing Working Capital and Seller Expenses, together with a calculation of the Cash Merger Consideration and each of the components thereofbased on such amounts. The Closing Statement and all amounts, estimates, determinations and calculations contained therein shall be prepared in good faith and calculated in accordance with the terms of this Agreement, including, as applicable, the Accounting PrinciplesSection 2.10(c). Parent shall, and shall cause the books and records of the Company Surviving Corporation and its Subsidiaries. During auditors to, make available to the thirty Representative and its auditors all records and work papers used in preparing the Closing Statement.
(30B) If the Representative disagrees in whole or in part with the Closing Statement, then, within 30 days immediately following Seller’s after its receipt of the Closing Statement, the Company Representative shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to notify Parent of such disagreement in writing (the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to ), setting forth in reasonable detail the particulars of any such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statementdisagreement. Any Notice of Disagreement delivered pursuant shall include a copy of Parent’s Closing Statement marked to this Section 1.5(aindicate the specific line items of the Closing Statement that are in dispute (the “Disputed Line Items”) and shall specify be accompanied by the Representative’s calculation of each of the Disputed Line Items and the Representative’s revised Closing Statement setting forth its determination of the Estimated Cash Merger Consideration and any component thereof. All items that are not Disputed Line Items shall be final, binding and conclusive for all purposes hereunder unless the resolution of a Disputed Line Item affects an undisputed item, in reasonable detail which case such undisputed item shall remain open and be considered a Disputed Line Item to the nature extent of such corresponding effect. In the event that the Representative does not provide a Notice of Disagreement within such 30-day period, the Representative shall be deemed to have accepted in full the Closing Statement as prepared by Parent, and amount such Closing Statement shall become final, binding and conclusive for all purposes hereunder as of 5:00 p.m. New York time on such 30th day. In the event any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Sellerproperly and timely provided, then the Closing Statement (as revised in accordance with this Section 1.5(b)) Parent and the resulting calculation Representative shall use commercially reasonable efforts for a period of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) 30 days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer they may mutually agree) to resolve any Disputed Line Items. During such 30-day period, Parent and Seller may agree the Representative shall cooperate with each other and shall have reasonable access to the books and records, working papers, schedules and calculations of the other used in writing), Buyer the preparation of the Closing Statement and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement and the determination of the Cash Merger Consideration and Disputed Line Items and the officers and other employees of the other Party, in each case, to the extent reasonably necessary or appropriate in connection with the resolution of the Disputed Line Items. All Disputed Line Items agreed to during such 30-day period shall be final, conclusive and binding on the Parties and not subject to further appeal. If, at the end of such period, Parent and the Representative are unable to resolve all such Disputed Line Items, then any such remaining Disputed Line Items shall be referred to a nationally-nationally recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller reasonably acceptable to Parent and the Representative (the “ArbiterAccounting Firm”) for review and resolution). Buyer and Seller shall instruct the Arbiter to, Parent and the ArbiterRepresentative will enter into reasonable and customary arrangements for the services to be rendered by the Accounting Firm under this Section 2.10(b)(ii)(B), acting such services to be provided in the Accounting Firm’s capacity as an accounting expert and not an arbitrator, . The Accounting Firm shall make a final determination of be directed to determine as promptly as practicable whether the items included Merger Consideration as set forth in the Closing Statement (to the extent requires adjustment. The Accounting Firm shall be instructed that, in making such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e.determination, it may not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned claimed by Buyer, on the one hand, either party or Seller, on the other hand, or less smaller than the smallest value for such item assigned claimed by Buyereither Party, on and that the one handAccounting Firm is only to consider matters still in dispute between Parent and the Representative. Parent, or Sellerthe Surviving Corporation and the Representative shall each furnish to the Accounting Firm such work papers and other documents and information relating to the Disputed Line Items, on the other handand shall provide interviews and answer questions, as such Accounting Firm may reasonably request. The Closing Statement and the resulting calculation determination of the Cash Consideration Accounting Firm shall become final be final, conclusive and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ Parties and Seller, shall be based solely on the date terms of this Agreement (including Section 2.10(a)) and the Arbiter delivers its final determination in writing to Buyer written submissions by Parent and Seller the Representative and not by independent review.
(which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30C) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees costs and expenses for the services of the Arbiter pursuant to this Section 1.5(b) Accounting Firm shall be borne by the CompanySurviving Corporation, on the one hand, and Sellerthe Representative (on behalf of the Sellers), on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded in inverse relation to Buyer and Seller, respectively, bears their success with respect to any disputes submitted to the aggregate amount actually contested by such partyAccounting Firm for resolution. For exampleSubject to the foregoing sentence, if Seller claims each party shall be responsible for its own fees and expenses incurred in connection with this Section 2.10(b).
(D) After the Cash Merger Consideration is $1,000 greater than has been finally determined in accordance with this Section 2.10(b)(ii) (the amount determined by BuyerCash Merger Consideration as so determined, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller“Final Cash Merger Consideration”), and if the Arbiter ultimately resolves following payments shall be made:
(1) If the dispute by awarding Seller $300 of Final Cash Merger Consideration exceeds the $500 contestedEstimated Cash Merger Consideration, then the costs and expenses of the Arbiter will be allocated 60% Surviving Corporation shall pay an amount in cash equal to such excess (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater but not more than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which of the Cap) to the Paying Agent or Surviving Corporation, as applicable (for further distribution to the Sellers on a pro rata basis based on their respective Pro Rata Shares in accordance with Section 2.13); or
(2) If the Estimated Cash Merger Consideration exceeds the Estimated Final Cash Merger Consideration (up such excess, the “Shortfall Amount”), then Parent and the Representative shall deliver joint written instructions to the Escrow Agent instructing the Escrow Agent to disburse to the Surviving Corporation, from the Escrow Account, an excess amount of cash and an amount of Escrow Shares (valued at the Parent Market Price) (but not more than the Escrow Amount), pro rata in amount to the Escrow Shares and Cash Escrow Amount contributed to the Escrow Account) from the Escrow Account equal to such Shortfall Amount.
(E) Any amount payable pursuant to Section 2.10(b)(ii)(D) shall be paid within 10 Business Days after the amount determination of the Adjustment Escrow Amount) Final Cash Merger Consideration by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of account designated in writing by the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Accountrecipient thereof.
(dF) Within five (5Payments pursuant to this Section 2.10(b)(ii) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (shall be treated for all purposes as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions adjustments to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 NotesCash Merger Consideration.
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Post-Closing Adjustment. (a) Within As soon as reasonably practicable after the Closing Date, but not later than ninety (90) days following after the Closing Date, Buyer shall, or Purchaser shall cause the Company to, prepare and deliver to Seller ALT a statement in the same form as the Estimated Closing Statement (the “Closing Adjustment Statement”) ), setting forth its Purchaser’s good faith calculation of the Cash Consideration Closing Date Net Working Capital (the “Final Closing Date Net Working Capital”). Final Closing Date Net Working Capital and each of the components thereof. The Closing Adjustment Statement shall be prepared and calculated in accordance with the Accounting Principles.
(b) Within forty-five (45) days after delivery of the Adjustment Statement to ALT (such period, as it may be extended pursuant to this Section 2.8(b), the “Protest Period”), ALT may deliver to Purchaser either (i) a written notice indicating that ALT has not received material information reasonably necessary to complete its review of the Adjustment Statement and specifying the additional information requested that has not been provided and is reasonably necessary for ALT to complete its review of the Adjustment Statement (a “Notice of Information Required”), or (ii) written notice of any objections or disagreements that ALT may have as to the Adjustment Statement, specifying in reasonable detail the basis of such objections or disagreements together with the amount(s) in dispute (a “Protest Notice”). Any line item or amount specifically included in the Adjustment Statement and not identified in the Protest Notice as in dispute shall be deemed to be agreed upon, fixed and binding upon the Parties. If ALT does not deliver a Protest Notice to Purchaser within the Protest Period, ALT shall be deemed to have agreed to the Adjustment Statement prepared and delivered by Purchaser, and such Adjustment Statement (and the calculations therein) shall be deemed to be final and binding upon the Parties. If ALT delivers a Notice of Information Required within the Protest Period, the Protest Period shall be extended until the date that is ten (10) Business Days after ALT’s receipt of the information requested in the Notice of Information Required.
(c) Upon receipt of a Protest Notice within the Protest Period, Purchaser and ALT shall attempt in good faith to resolve any disagreement or dispute regarding the Adjustment Statement. If Purchaser and ALT are unable to resolve any disagreement or dispute with respect to the Adjustment Statement within forty-five (45) days following Purchaser’s receipt of the Protest Notice, then such disagreement or dispute shall be submitted to ▇▇▇▇▇▇ LLP, or, if such firm is unable or unwilling to be engaged for such purpose, then Purchaser and ALT will mutually select another independent accounting firm (the “Arbitrating Accountant”). The Arbitrating Accountant will be instructed to send to Purchaser and ALT, within thirty (30) days of the date on which such dispute is referred to such Arbitrating Accountant, its determination on the specific matters in dispute which shall be final and binding on all Parties, absent fraud or manifest error, and shall be considered an arbitral award for all purposes, and upon which a judgment may be entered by a court having competent jurisdiction. Each of Purchaser and ALT shall submit, in writing, to the Arbitrating Accountant, their briefs detailing their views as to the correct nature and amount of each item remaining in dispute or disagreement, and the Arbitrating Accountant shall make such determination based solely on the data presented by Purchaser and ALT that are in accordance with the terms of this AgreementArticle II (i.e., includingnot by independent review). None of the Parties shall engage in ex parte communications with the Arbitrating Accountant. The Arbitrating Accountant shall be the sole arbiter of all matters, procedural or substantive, as to such matters in dispute. Each of Purchaser and ALT shall execute the Arbitrating Accountant’s standard engagement letter and fund one-half (1/2) of its standard retainer, if applicable; provided, that the Accounting Principles, total fees and the books and records costs of the Company and its Subsidiaries. During Arbitrating Accountant for such determination shall be paid by the thirty (30) days immediately following Seller’s receipt Party whose calculation of the Closing StatementDate Net Working Capital is farther from the final calculation of the Closing Date Net Working Capital after taking into account the determinations of the Arbitrating Accountant. For the avoidance of doubt, the Company Arbitrating Accountant shall provide not make any determination for any amount other than such amount or amounts in dispute and raised in a Protest Notice provided during the Protest Period. The Adjustment Statement and the Final Closing Date Net Working Capital shall incorporate the determination of the Arbitrating Accountant as well as those amounts not so in dispute, and shall be final and binding on the Parties.
(d) During the period from and after the date of delivery of the Adjustment Statement to ALT through the final determination of the Final Adjustment Amount contemplated by this Section 2.8, the Purchaser will afford the Seller Parties and its their representatives with reasonable access, during normal business hours and after upon reasonable advance prior notice, to the personnel, properties, books and records of the Company Business, and to any other information reasonably requested and reasonably available to the Purchaser for purposes of their review of preparing and reviewing the Closing Statementcalculations contemplated by this Section 2.8. The Closing Statement Purchaser shall authorize its accountants to disclose work papers generated by such accountants in connection with preparing and reviewing the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to calculations specified in this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.82.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up such accountants shall not be obligated to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to make any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding work papers available except in accordance with such accountants’ disclosure procedures and then only after the terms hereof, Buyer receiving party has signed an agreement relating to access to such work papers in form and the Seller shall cause the Escrow Agent (including by delivering joint written instructions substance acceptable to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Accountsuch accountants.
(de) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with determination of the terms hereof and if the Fundamental Change Repurchase Date Adjustment Statement:
(as such term is defined in the Senior Secured Notes Indenturei) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions The adjustment to the Escrow AgentClosing Cash Amount for Closing Date Net Working Capital computed in subsection (iii) of the definition thereof shall be recomputed using the Final Closing Date Net Working Capital in lieu of the Estimated Closing Date Net Working Capital, and (A) if such recomputed adjustment amount is greater than the Estimated Net Working Capital Adjustment Amount and would result in an adjustment in favor of Seller, then Purchaser shall pay such adjustment amount to make a payment from ALT as provided by subsection (ii) below, or (B) if such recomputed adjustment amount is less than the Estimated Net Working Capital Adjustment Escrow Account Amount and would result in an adjustment in favor of Purchaser, then such adjustment amount shall be paid to the Note Escrow Account of an Purchaser as provided by subsection (ii) below.
(ii) Any adjustment amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer owed pursuant to Section 1.5(c2.8(e)(i) (by Purchaser to ALT, on the one hand, or by ALT to Purchaser, on the other hand, is referred to as the “Final Adjustment Amount”; it being understood and agreed that if anythe net effect pursuant to this Section 2.8(e)(ii) is an increase in the Closing Cash Amount, then Purchaser shall pay by wire transfer of immediately available funds for purposes of making to ALT an offer amount in cash equal to repurchase the 2026 Notes Final Adjustment Amount, and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase net effect pursuant to this Section 2.8(e)(ii) is a decrease in the Closing Cash Amount, then Seller shall pay by wire transfer of immediately available funds to Purchaser and amount equal to such deficit, or at Purchaser’s election, set off and deduct from any amounts due to the Seller under this Agreement or the Seller Note. The Final Adjustment Amount shall be treated as an adjustment to the Closing Cash Amount for Income Tax purposes. Notwithstanding anything herein to the contrary, in no event shall the dollar amount of the Target Closing Date has occurred, the remaining Adjustment Escrow Funds shall instead Net Working Capital be released to Seller (and held in a deposit account subject to a control agreement adjustment for any reason in favor of the Consenting Noteholders) for the sole purpose of complying connection with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notescalculation under this Article II or otherwise.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety seventy-five (9075) days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement of the Net Working Capital of the Company as of the close of business on the business day immediately preceding the Closing Date, prepared in accordance with GAAP applied on a basis consistent with the 2005 Balance Sheet (the “Final Closing Statement”). Buyer and its accountants shall consult with Seller’s accountants in connection with the preparation of the Final Closing Statement and shall permit Seller’s accountants at the earliest practicable date, subject to the execution by Seller and Seller’s accountants of any reasonable release or indemnification agreement required by Buyer’s accountants, to review and make copies of all work papers, schedules and calculations used in the preparation of the Final Closing Statement.
(b) When Buyer delivers the Final Closing Statement, Buyer shall also deliver to Seller a certificate of the Chief Executive Officer of ACT (i) certifying that the Final Closing Statement was prepared on the basis and in accordance with the procedures set forth in paragraph (a) above, and (ii) containing Buyer’s calculations based on the Final Closing Statement (the “Buyer’s Proposed Calculations”), as applicable, of (A) the Net Working Capital of the Company as of the close of business on the business day immediately preceding the Closing Date (the “Closing StatementNet Working Capital”) setting forth its calculation of the Cash Consideration and each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles), and (B) the books and records Net Cash of the Company and its Subsidiariesas of the close of business on the business day immediately preceding the Closing Date (the “Closing Cash”). During the Within thirty (30) days immediately following Seller’s after receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Final Closing Statement and the resulting calculation accompanying certificate, Seller shall notify Buyer of its agreement or disagreement, as the case may be, with either the Final Closing Statement or the accuracy of any of the Cash Consideration shall become final Buyer’s Proposed Calculations. If Seller disputes any aspect of the Final Closing Statement or the amount of any of the Buyer’s Proposed Calculations and binding upon Buyer does not accept Seller’s proposed alternative calculations (the parties hereto “Seller’s Proposed Calculations”), then the Independent Accounting Firm will resolve the remaining disputed items (the “Remaining Disputed Items”) within thirty (30) days following after the date of the Independent Accounting Firm’s engagement, by conducting its own review and test of the Final Closing Statement, and thereafter selecting either Buyer’s Proposed Calculations of the Remaining Disputed Items or Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation Proposed Calculations of the Cash Consideration Remaining Disputed Items, or an amount in between the two. The Independent Accounting Firm shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration be selected by agreement of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved shall be engaged jointly by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below)Seller. The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery Each of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which agrees that they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed bound by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination Remaining Disputed Items by the Arbiter shall not be subject to court review or otherwise appealableIndependent Accounting Firm. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) Independent Accounting Firm shall be borne paid jointly, one-half by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested one-half by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If Upon the determination pursuant to paragraph (b) of this Section 2.5 of the Final Closing Statement, Closing Net Working Capital, and Closing Cash, the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding Purchase Price shall be recalculated in accordance with the terms hereofSection 2.4, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration using (up to an excess equal to i) the amount of the Adjustment Escrow AmountClosing Net Working Capital so determined pursuant to Section 2.5(b) by wire transfer in lieu of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth Calculation Date Net Working Capital used in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash ConsiderationInitial Adjustment, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after amount of the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer Cash so determined pursuant to Section 1.5(c2.5(b) (if any) in lieu of the amount of the Calculation Date Cash used for purposes of Section 2.4. If the Cash Purchase Price as so calculated is less than the Cash Purchase Price as adjusted pursuant to the Initial Adjustment, Seller shall pay the amount of such difference to Buyer in cash by wire transfer of immediately available funds for purposes of making an offer to repurchase within ten (10) days after the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements determination set forth in this paragraph (c). If the Senior Secured Notes Supplemental Indenture with respect Cash Purchase Price as so calculated is more than the Cash Purchase Price as adjusted pursuant to any remaining 2025 Notesthe Initial Adjustment, Buyer shall pay the amount of such difference to Seller in cash by wire transfer within ten (10) days after the determination set forth in this paragraph (c).
Appears in 1 contract
Sources: Stock Purchase Agreement (Advanced Communications Technologies Inc)
Post-Closing Adjustment. (a) Within ninety (90) days As soon as reasonably practicable following the Closing Date, and in any event within thirty (30) calendar days thereof, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement (the “Closing Date Statement”) setting forth its calculation good faith calculations of (i) Net Working Capital as of the Cash Consideration and each close of business on the components thereof. The day immediately preceding the Closing Statement shall be prepared in good faith Date, calculated in accordance with the terms of this AgreementAccounting Principles (“Closing Date Net Working Capital”), includingtogether with appropriate supporting schedules, as applicable, the Accounting Principlescalculations and documentation, and the books and records its calculation of the Net Working Capital Adjustment Amount derived therefrom, (ii) the aggregate amount of Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt Debt as of the close of business on the day immediately preceding the Closing StatementDate, (iii) the aggregate amount of Company Cash as of the close of business on the day immediately preceding the Closing Date and (iv) the aggregate amount of Seller Transaction Expenses. A sample Closing Date Statement is attached hereto as Schedule 2.5 for illustrative purposes only. Following the Closing, Buyer shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, access to the books records, properties, personnel and records (subject to the execution of customary work paper access letters if requested) auditors of the Company for purposes relating to the preparation of their the Closing Date Statement and shall cause the personnel of the Company to reasonably cooperate with Seller in connection with its review of the Closing Date Statement. The Closing Statement and the resulting calculation .
(b) If Seller shall disagree with any aspect of the Cash Consideration Closing Date Statement (including the calculations or the amounts set forth therein), it shall become final and binding upon notify Buyer of such disagreement in writing (the parties hereto “Objection”), setting forth in reasonable detail the particulars of such disagreement, within thirty (30) days following Seller’s after its receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and Date Statement. In the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the event that Seller does not provide an Objection within such thirty (30) day period, of written notice Seller shall be deemed to Buyer of its acceptance of have accepted the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Date Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of calculations and amounts set forth therein, which shall be final, binding and conclusive for all purposes hereunder. In the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by event an Objection is timely provided, Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the use reasonable best efforts for a period of thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller they may agree in writing)mutually agree) to resolve any disagreements with respect to the Closing Date Statement. If, Buyer and Seller shall submit any and all matters (but only at the end of such matters) which remain in dispute and which were properly included in the Notice of Disagreement period, they are unable to a nationally-recognized independent accounting firm that is mutually selected by resolve such disagreements, then ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement LLP (i.e., not on the basis or such independent accounting or financial consulting firm of an independent review). recognized national standing as may be mutually selected by Buyer and Seller Seller) (the “Auditor”) shall cooperate with resolve any remaining disagreements. The Auditor shall be instructed to resolve solely those matters specified in the Arbiter during the term of its engagementObjection. Buyer The Auditor shall investigate only those items which are in dispute and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute that is (A) greater than the greatest value for such item assigned claimed by Buyer, on the one hand, either of Buyer or Seller, on the other hand, Seller or less (B) lower than the smallest lowest value for such item assigned claimed by Buyer, on the one hand, either of Buyer or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration Auditor’s determination shall become final and binding on the parties hereto, if not already mutually agreed be based only upon written submissions by ▇▇▇▇▇ Buyer and Seller, on and not upon an independent review by the date Auditor. The Parties shall instruct the Arbiter delivers Auditor to render its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than within thirty (30) days following submission of the referral of such disputed matters)matter thereto, and such final the determination by of the Arbiter Auditor shall not be subject to court review final, binding and non-appealable upon all parties for all purposes of this Agreement. None of Seller, Buyer or otherwise appealablethe Company shall have any ex parte communications or meetings with the Auditor without the prior consent of Buyer (in the case of Seller) or Seller (in the case of Buyer or the Company). The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Companyfees, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will Auditor shall be allocated 60% paid (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amounti) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that Seller if the Fundamental Change Repurchase Date has occurred, items covered thereby are resolved in favor of Buyer or (ii) by Buyer if the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement items covered thereby are resolved in favor of the Consenting Noteholders) for Objection. If the sole purpose items referred to therein are resolved in part in favor of complying the Objection and in part in favor of Buyer, such fees, costs and expenses shall be allocated between Seller and Buyer in inverse proportion as Seller and Buyer may prevail on matters resolved by the Auditor, which proportionate allocations shall be determined by the Auditor; provided, however, that Seller shall be considered the prevailing party with mandatory repurchase requirements respect to any matter resolved by the Auditor if the Objection giving rise thereto resulted from Buyer’s failure to provide Seller with the records, properties, personnel and auditors back-up or supporting data relating to the preparation of the Closing Date Statement reasonably and timely requested by Seller in accordance with this Section 2.5. The date on which all disputed amounts set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Date Statement becomes final and binding are finally determined in accordance with this Section 2.5(b) is hereinafter referred to as the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account“Determination Date.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.”
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety (90) As promptly as practicable, but in any case no later than 60 days following after the Closing Date, Buyer shall, or Parent shall cause the Company to, Surviving Corporation to prepare and deliver to Seller the Stockholders’ Representative a written statement (the “Closing Statement”) setting forth its the Surviving Corporation’s good faith calculation of (i) Closing Cash, (ii) Closing Working Capital, (iii) Closing Indebtedness, (iv) Transaction Expenses and (v) Company Tax Benefits, together with such schedules and data with respect to the Cash Consideration and each determination of the components thereofforegoing as may be appropriate to support the calculations set forth in the Closing Statement. The foregoing items shall be calculated by the Surviving Corporation in a manner consistent with the form, methodologies, estimation techniques, assumptions and principles used to prepare the Estimated Closing Statement shall (provided that such methodologies, estimation techniques, assumptions and principles must be prepared in good faith in accordance with GAAP and consistent with those used in the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records Financial Statements). Following delivery of the Company Closing Statement and until the Closing Statement has become final and binding as set forth in this Section 2.16, Parent shall provide to the Stockholders’ Representative and its Representatives, on reasonable advance notice and during regular business hours, reasonable access to relevant information, personnel and properties of the Surviving Corporation and its Subsidiaries. During , as well as to any documents or work papers used in the thirty preparation of the Closing Statement, in each case, as the Stockholders’ Representative may reasonably request in connection with its review of the Closing Statement.
(30b) If the Stockholders’ Representative disagrees with the Closing Statement or the calculations of the amounts set forth therein, the Stockholders’ Representative may, within 30 days immediately following Seller’s after receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance deliver written notice to Parent (such notice, a “Dispute Notice”) setting forth in reasonable detail the reason for such disagreement and alternative calculations with respect to the books and records of items or amounts with which it disagrees (each, a “Disputed Item”). Any item or amount not objected to in the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration Dispute Notice (an “Undisputed Item”) shall become final and binding upon on the parties hereto thirty for purposes of this Agreement, except to the extent that an adjustment to a Disputed Item made in accordance with this Section 2.16 requires an offsetting adjustment to be made to an Undisputed Item. If the Stockholders’ Representative fails to deliver a Dispute Notice to Parent within 30 days after delivery of the Closing Statement to the Stockholders’ Representative, or if the Stockholders’ Representative notifies Parent in writing that it will not deliver a Dispute Notice, then the Closing Statement in its entirety shall be final and binding on the parties for purposes of this Agreement.
(30c) If the Stockholders’ Representative delivers a Dispute Notice, Parent and the Stockholders’ Representative shall negotiate in good faith to resolve each Disputed Item set forth therein, and any resolution agreed to in writing by Parent and the Stockholders’ Representative with respect to each Disputed Item shall be final and binding on the parties for purposes of this Agreement. If Parent and the Stockholders’ Representative are able to resolve all of the Disputed Items, then the Closing Statement, adjusted to reflect such resolution of all Disputed Items, shall be final and binding on the parties for purposes of this Agreement. If Parent and the Stockholders’ Representative are unable to resolve all Disputed Items within 20 days following Seller’s receipt thereof unless Seller delivers after delivery of the Dispute Notice, then either Parent or the Stockholders’ Representative may refer the unresolved Disputed Items to the Accounting Arbitrator for final determination.
(d) Parent and the Stockholders’ Representative shall each have the opportunity to provide written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such datesubmissions regarding their positions on the unresolved Disputed Items; provided that such written submissions are delivered to the Accounting Arbitrator, if at all, no later than 20 days after the date the unresolved Disputed Items are referred to the Accounting Arbitrator. Parent and the Stockholders’ Representative shall make available to the Accounting Arbitrator the relevant information in their possession and relevant personnel and properties of the Surviving Corporation and its Subsidiaries, as well as any documents or work papers used in the preparation of the Closing Statement and the resulting calculation Dispute Notice, and all other items in their possession reasonably requested by the Accounting Arbitrator, and shall provide copies of all of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior foregoing to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationseach other.
(be) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration The Accounting Arbitrator shall become final and binding upon the parties on the earlier of consider only (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller those Disputed Items submitted to it for resolution and (ii) any Undisputed Items or Disputed Items previously resolved between Parent and the date any and all matters specified Stockholders’ Representative that require an offsetting adjustment to be made in connection with the Notice resolution of Disagreement not resolved by Buyer and Seller are finally resolved in writing by such Disputed Items. In resolving each such Disputed Item, the Arbiter Accounting Arbitrator (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Selleri) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of resolve such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and Disputed Item in accordance with the guidelines and procedures set forth in provisions of this Agreement Agreement, (i.e., not ii) shall make its determination based solely on the basis of an independent review). Buyer presentations and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, supporting material provided by Parent and the Arbiter shall not, Stockholders’ Representative and not pursuant to any independent review and (iii) may not assign a value to any item in dispute (A) greater than the greatest value for such item assigned claimed by Buyer, on either Parent or the one hand, Stockholders’ Representative or Seller, on the other hand, or (B) less than the smallest value for such item assigned claimed by Buyereither Parent or the Stockholders’ Representative.
(f) The Accounting Arbitrator shall deliver to Parent and the Stockholders’ Representative, on as promptly as practicable and in any event shall endeavor to do so within 30 days after its appointment, a written report (i) setting forth (x) the one hand, resolution of each Disputed Item submitted to it and (y) any adjustments that are required to be made to any Undisputed Items or Seller, on Disputed Items previously resolved between Parent and the other handStockholders’ Representative to reflect such resolution and (ii) containing a revised Closing Statement reflecting the foregoing (the “Arbitrator’s Report”). The Arbitrator’s Report and the revised Closing Statement and the resulting calculation of the Cash Consideration contained therein shall become be final and binding on upon the parties hereto, if not already mutually agreed by ▇▇▇▇▇ for purposes of this Agreement and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. .
(g) The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Companyfees, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will Accounting Arbitrator shall be allocated 60% borne by (i.e., 300 ÷ 500i) Parent in the proportion that (A) the aggregate dollar amount of the Disputed Items that are resolved in favor of the Stockholders’ Representative bears to (B) the aggregate dollar amount of the Disputed Items submitted to the Company Accounting Arbitrator and 40% (i.e.ii) the Stockholders’ Representative (on behalf of the Securityholders) in the proportion that (A) the aggregate dollar amount of the Disputed Items that are resolved in favor of Parent bears to (B) the aggregate dollar amount of the Disputed Items submitted to the Accounting Arbitrator, 200 ÷ 500) to Sellerin each case, as finally determined by the Accounting Arbitrator.
(ch) If the Cash Consideration Post-Closing Adjustment Amount is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurreda positive number or zero, then, within five (5) two Business Days after final determination of the Post-Closing Statement becomes final Adjustment Amount, (i) Parent and binding in accordance with the terms hereof, Stockholders’ Representative shall deliver a Joint Direction instructing the Company shallEscrow Agent to release from the Escrow Account to the Stockholders’ Representative an aggregate amount equal to the Purchase Price Adjustment Holdback Amount, and Buyer (ii) Parent shall cause pay the Company to, make a payment to the Note Escrow Account of Stockholders’ Representative an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Post-Closing Adjustment Escrow Amount) , in each case by wire transfer of immediately available funds to the account or accounts designated in writing by the Stockholders’ Representative and for purposes of making an offer to repurchase distribution by the 2026 Notes and the 2025 Notes Stockholders’ Representative in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration 2.16(j).
(up to an excess equal to the amount of the Adjustment Escrow Amounti) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration Post-Closing Adjustment Amount is greater than the Cash Considerationa negative number, then, within five (5) two Business Days after final determination of the Post-Closing Statement becomes final and binding in accordance with the terms hereofAdjustment Amount, Buyer Parent and the Seller Stockholders’ Representative shall cause deliver a Joint Direction instructing the Escrow Agent (including by delivering joint written instructions to release from the Escrow AgentAccount (i) to make payment to Buyer (or its designees) of an amount equal to Parent, the lesser of (iA) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, Purchase Price Adjustment Holdback Amount and (iiB) the absolute value of the Post-Closing Adjustment Escrow FundsAmount, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds to the account or accounts designated in writing by Parent, and (ii) to the Stockholders’ Representative, any remaining amount of the Purchase Price Adjustment Holdback Amount following the payment to Parent made pursuant to clause (i), by wire transfer of immediately available funds to the account or accounts designated in writing by the Stockholders’ Representative and for purposes of making an offer to repurchase distribution by the 2026 Notes and the 2025 Notes Stockholders’ Representative in accordance with Section 1.8; provided2.16(j). If the Post-Closing Adjustment Amount payable to Parent exceeds the Purchase Price Adjustment Holdback Amount, that if Parent shall, in addition to its rights to receive the Fundamental Change Repurchase Date has occurredPurchase Price Adjustment Holdback Amount pursuant to the immediately preceding sentence, be entitled to receive the amount of such excess as a distribution from the General Indemnity Holdback Amount, and Parent and the Stockholders’ Representative shall deliver a Joint Direction instructing the Escrow Agent to release such excess amount from the Escrow Account to Parent.
(j) Promptly following receipt by the Stockholders’ Representative of the Net Adjustment Amount, the remaining Stockholders’ Representative shall pay:
(i) to each Direct Payment Holder, an amount equal to (A) the number of shares of Common Stock held by such Direct Payment Holder immediately prior to the Effective Time, multiplied by (B) the Net Per Share Adjustment Escrow Funds Amount; and
(ii) to Parent, for the benefit of the holders of (x) issued and outstanding shares of Common Stock immediately prior to the Effective Time (other than the Direct Payment Holders) and (y) outstanding and unexercised vested Participating Options immediately prior to the Effective Time, an amount equal to (A) the sum of (1) the number of shares of Common Stock issued and outstanding immediately prior to the Effective Time (excluding shares of Common Stock held by the Direct Payment Holders and shares of Common Stock to be cancelled pursuant to Section 2.07(d)), plus (2) the number of shares of Common Stock issuable upon the exercise of such Participating Options, multiplied by (B) the Net Per Share Adjustment Amount.
(k) As soon as practicable after Parent’s receipt of the amounts paid to it pursuant to Section 2.16(j)(ii), Parent shall instead be released deliver to Seller each holder of issued and outstanding shares of Common Stock immediately prior to the Effective Time who has delivered a Letter of Transmittal in accordance with Section 2.12 (and other than the Direct Payment Holders referenced in Section 2.16(j)(i)), an amount in cash, without interest, equal to (i) the aggregate number of shares of Common Stock held in a deposit account by such holder, multiplied by (ii) the Net Per Share Adjustment Amount, subject to a control agreement any applicable Tax withholding in favor accordance with Section 2.10.
(l) As soon as practicable after Parent’s receipt of the Consenting Noteholdersamounts paid to it pursuant to Section 2.16(j)(ii), Parent shall deliver to each holder of vested Participating Options that were outstanding and unexercised immediately prior to the Effective Time, an amount in cash, without interest, equal to (i) for the sole purpose aggregate number of complying with mandatory repurchase requirements set forth in shares of Common Stock issuable upon the Senior Secured Notes Supplemental Indenture with respect exercise of such Participating Options, multiplied by (ii) the Net Per Share Adjustment Amount, subject to any remaining 2025 Notesapplicable Tax withholding in accordance with Section 2.10. Such amounts payable pursuant to this Section 2.16(l) shall be delivered through the Surviving Corporation’s normal payroll procedures as soon as practicable after Parent’s receipt of such amounts (but in no event later than the next scheduled payroll date of the Surviving Corporation immediately succeeding such date of receipt).
(m) All payments made pursuant to Section 2.16 shall be treated as an adjustment to the Aggregate Closing Merger Consideration by the parties for all purposes under this Agreement and for Tax purposes, unless otherwise required by applicable Law.
Appears in 1 contract
Sources: Merger Agreement (Keyw Holding Corp)
Post-Closing Adjustment. (a1) Within ninety (90) days following If the Purchase Price set forth in the Closing DateStatements is equal to the Estimated Purchase Price set forth in the Estimated Statements, Buyer shallthen no further adjustment will be made to the Purchase Price and, or with respect to the Adjustment Escrow Fund, the Purchaser and the Vendors shall cause provide joint written instructions to the Company to, prepare and deliver Escrow Agent to Seller a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and release to each of the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of Vendors their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount Pro Rata Portion of the Adjustment Escrow Amount) Fund, by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of accounts designated by the Adjustment Escrow AmountVendors.
(2) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of If the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements Purchase Price set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration Closing Statements is greater than the Cash ConsiderationEstimated Purchase Price set forth in the Estimated Statements, within five then the Purchaser shall pay to the Vendors the amount of such difference as follows:
(5a) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer Purchaser and the Seller Vendors shall cause the Escrow Agent (including by delivering provide joint written instructions to the Escrow Agent) Agent to make payment release to Buyer (or its designees) each of an amount equal to the lesser Vendors their Pro Rata Portion of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow FundsFund, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes to the accounts designated by the Vendors; and
(b) to the extent that the difference owed by the Purchaser to the Vendors exceeds the amount of making an offer the Adjustment Escrow Fund, the Purchaser shall pay to repurchase each of the 2026 Notes and Vendors their Pro Rata Portion of the 2025 Notes remaining balance by wire transfer of immediately available funds to the accounts designated by the Vendors within two Business Days after the Draft Closing Statements become the Closing Statements in accordance with Section 1.8; provided2.6(4) or Section 2.6(5) (the “Adjustment Date”), that if as the Fundamental Change Repurchase Date has occurred, case may be.
(3) If the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements Purchase Price set forth in the Senior Secured Notes Supplemental Indenture with respect Closing Statements is less than the Estimated Purchase Price set forth in the Estimated Statements, then the Vendors shall pay to any the Purchaser the amount of such difference as follows:
(a) if the difference owed by the Vendors to the Purchaser exceeds the amount of the Adjustment Escrow Fund, then on the Adjustment Date,
(i) the Purchaser and the Vendors shall provide joint written instructions to the Escrow Agent to release to the Purchaser the Adjustment Escrow Fund, by wire transfer of immediately available funds to an account designated by the Purchaser; and
(ii) each of the Vendors shall pay to the Purchaser their Pro Rata Portion of the remaining 2025 Notesbalance owed to the Purchaser by wire transfer of immediately available funds to the account designated by the Purchaser.
(b) If the difference owed by the Vendors to the Purchaser is less than the amount of the Adjustment Escrow Fund, then on the Adjustment Date, the Purchaser and the Vendors shall provide joint written instructions to the Escrow Agent to release:
(i) to the Purchaser from the Adjustment Escrow Fund an amount equal to such difference, by wire transfer of immediately available funds to an account designated by the Purchaser; and
(ii) to each of the Vendors their Pro Rata Portion of the remaining balance of the Adjustment Escrow Fund (after the payment to the Purchaser in Section 2.7(3)(b)(i)), by wire transfer of immediately available funds to accounts designated by the Vendors.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety one hundred twenty (90120) days following after the Closing Date, Buyer shall, or shall cause the Company to, Purchaser will prepare and deliver to Seller the Company Representative (i) an unaudited consolidated balance sheet of the Company as of the Adjustment Time, prepared in accordance with the Accounting Principles (the “Closing Balance Sheet”), and (ii) a statement statement, prepared in good faith and in accordance with the Accounting Principles and the applicable definitions contained in this Agreement, setting forth Purchaser’s good faith calculations of Closing Indebtedness, Closing Net Working Capital, Transaction Expenses, Closing Cash, the Deferred Cash Amount and the resulting Cash Adjustment Amount and the resulting calculation of the final Merger Consideration (together with the Closing Balance Sheet, the “Closing Statement”) setting forth its calculation of ), together with reasonable supporting documentation for the Cash Consideration calculations and each of amounts contained in the components thereofClosing Statement. The If Purchaser fails to deliver the Closing Statement shall be prepared in good faith in accordance with this Section 2.14(a) within one hundred twenty (120) days after the terms Closing Date, then Purchaser will be deemed to have irrevocably accepted the Company’s calculation of Estimated Closing Indebtedness, Estimated Closing Net Working Capital, Estimated Transaction Expenses, Cash Adjustment Amount and the resulting Estimated Merger Consideration, in which case, all such amounts will be final and binding on the parties for purposes of this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its SubsidiariesSection 2.14. During the thirty (30b) Within forty-five (45) days immediately following Seller’s receipt after delivery of the Closing Statement, the Company shall provide Seller and Representative may dispute Purchaser’s calculation of Closing Indebtedness, Closing Net Working Capital, Transaction Expenses or the resulting final Merger Consideration by delivering to Purchaser a written notice (a “Dispute Notice”) setting forth in reasonable detail the basis for each such disputed item. The Company Representative may not in its representatives with reasonable accessDispute Notice change the calculation of any line item included in the calculation of Estimated Closing Net Working Capital (as set forth in the Estimated Closing Statement) if such change would, during normal business hours and after reasonable advance noticetaken on an individual basis, have the result of increasing the Estimated Merger Consideration compared to what was reflected in the books and records of the Company for purposes of their review of Estimated Closing Statement, other than to respond to changes in such line items set out in the Closing Statement. The Closing Statement Purchaser will (and will cause the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30Surviving Company to) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) furnish to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.Representative and
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety (90) 120 days following after the Closing Date, Buyer shallAcquirer shall prepare and deliver, or shall cause to be prepared and delivered, to the Company to, prepare and deliver to Seller Agent a statement (the “Closing Statement”) ), setting forth its calculation determination of the Cash Consideration amount of Company Net Working Capital (and each any corresponding Closing Net Working Capital Shortfall or Closing Net Working Capital Surplus), Closing Cash, Closing Indebtedness and Transaction Expenses that remained unpaid as of immediately prior to the Closing, and, based on the foregoing, its determination of the components thereofClosing Consideration. The Closing Statement shall be prepared in accordance with the Accounting Standards and the applicable definitions and terms of this Agreement and shall provide reasonable detail for each of the foregoing, including support for each such determination.
(b) Unless the Agent notifies Acquirer in writing within 30 days after Acquirer’s delivery of the Closing Statement (such 30-day period, the “Objection Period”) that the Agent believes in good faith that the Closing Statement contains mathematical errors or was not prepared in accordance with the terms of this Agreement, includingincluding the requirements of this Section 2.6 and such notification specifies in reasonable detail each item that the Agent disputes (each, as applicablea “Disputed Item”), the Accounting Principles, amount in dispute for each such Disputed Item and the books reasons supporting the Agent’s positions (a “Notice of Objection”), the Closing Statement and records of the determinations set forth therein shall be final, binding and conclusive on Acquirer, the Agent and the Company and its SubsidiariesHolders. During the thirty (30) days immediately following SellerObjection Period and solely for purposes of the Agent’s receipt review of the Closing StatementStatement and preparation of any Notice of Objection, Acquirer shall afford the Company shall provide Seller Agent and its representatives Representatives with reasonable access, during normal business hours and after upon reasonable advance prior notice, to the personnel, properties, books and records of Acquirer and the Company Surviving Corporation and to any other information reasonably requested for purposes of their review preparing and reviewing the calculations contemplated by this Section 2.6. For the avoidance of doubt, the Agent shall be deemed to have agreed with all other items and amounts contained in the Closing Statement not so disputed by the Agent, and to have irrevocably waived all rights to object to such items and amounts under this Agreement.
(c) If the Agent provides the Notice of Objection to Acquirer within the Objection Period, the Agent and Acquirer shall, during the 30-day period following Acquirer’s receipt of the Closing StatementNotice of Objection (such 30-day period, the “Resolution Period”), attempt in good faith to resolve each Disputed Item. During the Resolution Period, the Agent shall permit, except as required by Law, Acquirer and its Representatives to review the working papers of the Agent and, subject to Acquirer’s and its applicable Representatives entry into a customary confidentiality agreement, its accountants (if applicable) relating to the Notice of Objection and the basis therefor. If the Agent and Acquirer are unable to resolve all of the Disputed Items within the Resolution Period (the “Unresolved Items”), the Unresolved Items shall be submitted to PwC or if PwC is not available, a nationally recognized independent valuation, accounting or specialty firm to be mutually agreed upon by the Agent and Acquirer, which accounting firm shall not have worked with the Agent, the Company or Acquirer or any of their respective Affiliates in the preceding 12 months (PwC or if applicable, such agreed firm, being the “Independent Expert”). The Closing Statement Independent Expert shall be engaged pursuant to an engagement letter among the Agent, Acquirer and the resulting calculation of Independent Expert on terms and conditions consistent with this Section 2.6(c). The Independent Expert shall be instructed, pursuant to such engagement letter, to resolve only the Cash Consideration Unresolved Items and not to otherwise investigate any matter independently. The Agent and Acquirer each agree to furnish to the Independent Expert access, except as required by Law, to such individuals and such information, books and records as may be reasonably required by the Independent Expert to make its final determination (and any such information, books and records shall become final and binding upon be provided to the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer other such Party prior to such dateits submission or presentation to the Independent Expert). The Agent and Acquirer shall also instruct the Independent Expert to render its reasoned written decision as promptly as practicable but in no event later than 30 days from the date that information related to the Unresolved Items is presented to the Independent Expert by the Agent and Acquirer; provided that if either the Agent or Acquirer fails to present requested information or furnish access to the Independent Expert within the time determined by the Independent Expert, then the Independent Expert shall render its decision based solely on the information actually presented and access actually furnished to it by the Agent and Acquirer. With respect to each Unresolved Item, such decision shall be made based on the terms and conditions of this Agreement and shall not be in excess of the higher, nor less than the lower, of the amounts advocated by Acquirer in the Closing Statement and or the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified Agent in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have Objection with respect to such Unresolved Item. Except as the Agent and Acquirer may otherwise agree, all communications between the Agent and Acquirer or any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Companytheir respective Representatives, on the one hand, and Sellerthe Independent Expert, on the other hand, shall be in writing with copies simultaneously delivered to the other such Party. The resolution of Unresolved Items by the Independent Expert shall be final, binding and conclusive on Acquirer, the Agent and the Company Holders. All fees and expenses of the Independent Expert shall be 1617803317.10 borne on a proportionate basis by ▇▇▇▇▇▇▇▇, on the one hand, and the Agent, on the other, based upon on the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, in favor of Acquirer or the Agent bears to the aggregate amount actually contested by such partyPerson. For example, if Seller claims the Cash Consideration is Acquirer’s calculations would have resulted in a $1,000 greater than the amount determined by Buyer1,000,000 net payment to Acquirer, and ▇▇▇▇▇ contests only the Agent’s calculations would have resulted in a $500 1,000,000 net payment to Company Holders and the Independent Expert’s final determination as adopted pursuant to this Section 2.6(c) results in an aggregate net payment of $500,000 to the Company Holders, then Acquirer, on the one hand, and the Agent, on the other hand, shall pay 75% and 25%, respectively, of such fees and expenses.
(d) The following payments shall be made promptly after the final determination of the amount claimed by Seller, and if Closing Consideration in accordance with this Section 2.6 (the Arbiter ultimately resolves Closing Consideration as so determined being referred to herein as the dispute by awarding Seller $300 of “Final Closing Consideration”):
(i) If the $500 contestedFinal Closing Consideration exceeds the Estimated Closing Consideration (the “Excess Amount”), then the costs and expenses Agent shall promptly deliver to Acquirer an updated Spreadsheet setting forth the allocation of the Arbiter will Excess Amount among the Carve-Out Plan Participants and the Company Holders and within five Business Days of receipt of such updated Spreadsheet, Acquirer shall pay, or cause to be allocated 60% paid, (i.e., 300 ÷ 500A) the Incentive Bonuses (as defined under the Carve-Out Plan) that become payable to the Company Carve-Out Plan Participants pursuant to the terms and 40% (i.e., 200 ÷ 500) to Seller.
(c) If conditions of the Cash Consideration is greater than the Estimated Cash Consideration Carve-Out Plan and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements allocation set forth in the Senior Secured Notes Supplemental Indenture Spreadsheet via its or the Surviving Corporation’s payroll in accordance with standard payroll practices (subject to any required withholding for applicable Taxes and solely to the extent such Carve-Out Plan Participants are eligible to receive such Incentive Bonuses under the Carve-Out Plan) and (B) an amount in cash equal to (I) the Excess Amount minus (II) the total amount payable by Acquirer in accordance with clause (A) (including the employer portion of any employment, payroll Taxes, or other Taxes arising in connection therewith) to the Paying Agent for further distribution to the Company Holders (who have delivered the applicable documents required under Section 2.5) pursuant to the updated Spreadsheet delivered by the Agent. In addition, Acquirer and the Agent shall promptly deliver a joint instruction to the Escrow Agent instructing the Escrow Agent to release and distribute to the Paying Agent or Acquirer (with respect to the Carve-Out Plan Participants) the funds remaining in the Adjustment Escrow Account for further distribution to the Escrow Participants pursuant to their respective Escrow Pro Rata Share (subject to any remaining 2025 Notes. required withholding for applicable Taxes with respect to the Carve-Out Plan Participants and solely to the extent such Carve-Out Plan Participants are eligible to receive such Incentive Bonuses under the Carve-Out Plan).
(ii) If the Estimated Cash Closing Consideration is greater than exceeds the Cash ConsiderationFinal Closing Consideration (such excess, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof“Shortfall Amount”), Buyer then Acquirer and the Seller Agent shall cause deliver a joint written instruction to the Escrow Agent (including by delivering joint written instructions to instructing the Escrow AgentAgent to (A) disburse to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each caseAcquirer, from the Adjustment Escrow Account.
Account an amount in cash equal to the Shortfall Amount and (dB) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term Shortfall Amount is defined in less than the Senior Secured Notes Indenture) has not yet occurredAdjustment Escrow Amount, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions disburse to the Escrow AgentPaying Agent and Acquirer (with respect to the Carve-Out Plan Participants) to make a payment from the funds remaining in the Adjustment Escrow Account (net of the employer portion of any employment, payroll Taxes, or other Taxes arising in connection with the payments to the Note Escrow Account of an amount equal Carve-Out Plan Participants resulting from such release, but only if not already deducted) for further distribution to the remaining Escrow Participants pursuant to their respective Escrow Pro Rata Share (subject to any required withholding for applicable Taxes with respect to the Carve-Out Plan Participants and solely to the extent such Carve-Out Plan Participants are eligible to receive such Incentive Bonuses under the Carve-Out Plan). If the Shortfall Amount is greater than the Adjustment Escrow Funds (if any) after Amount, Acquirer may, in its sole discretion, elect to recover the remaining Shortfall Amount from the Indemnity Escrow Fund or by setting off against any payments are made to Buyer Milestone Payment that becomes payable pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in 2.7 or a deposit account subject to a control agreement in favor combination of the Consenting Noteholdersforegoing.
(e) for For Tax purposes, any payments under this Section 2.6 shall be treated as an adjustment to the sole purpose of complying with mandatory repurchase requirements set forth in Merger Consideration to the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesmaximum extent permitted by applicable Law.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety (90) days following the Closing Date or, if later, 30 days after the Deferred French Closing Date, the Buyer shall, or shall cause the Company to, prepare and deliver to the Seller a statement (the “Closing Initial Statement”) calculating and setting forth its calculation of the Cash Consideration actual Adjustment Value on the Closing Date (the “Closing Adjustment Value”), which statement shall include a worksheet setting forth in reasonable detail how such value and each of the components thereofpayment were calculated. The Closing Initial Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, GAAP and consistent with Schedule 1.1(a) and the books and records of the Company and its Subsidiaries. During the thirty Agreed Valuation Principles.
(30b) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration Adjustment Value shall become final and binding upon the parties hereto Parties thirty (30) days following Seller’s after the receipt thereof unless by the Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Seller, then the Closing Initial Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of unless (i) the date Seller concludes that the Closing Adjustment Value or any and all matters specified in component thereof has not been prepared on the Notice of Disagreement are finally resolved in writing basis required by ▇▇▇▇▇ and Seller this Agreement, and (ii) the date any and all matters specified Seller has promptly, but in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more no event later than thirty (30) days following submission after its receipt of the Initial Statement (the “Review Period”), delivered to the Buyer written notice describing in reasonable detail the basis of the Seller’s disagreement, the amount or amounts involved and the proposed determination of the disputed amount or amounts (a “Dispute Notice”). If the Seller delivers a Dispute Notice to the Buyer within the Review Period, the Buyer and the Seller will use reasonable good faith efforts to resolve the dispute during the 30-day period commencing on the date the Seller delivers the Dispute Notice to the Buyer. If the Seller and the Buyer are not able to resolve all disputed items within such 30-day period, then the items remaining in dispute shall be submitted immediately to ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP or, if ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP is unwilling or unable to serve, an independent nationally recognized firm with no existing business relationship with any Party mutually agreeable to the Seller and the Buyer (the “Accounting Firm”). The Accounting Firm shall be given reasonable access to all relevant records of the Buyer and the Selling Group to resolve any items that are disputed and to calculate the Adjustment Value in connection with the resolution of such disputed matters)items. If any remaining issues in dispute are submitted to the Accounting Firm for resolution, each of the Seller and the Buyer will be afforded an opportunity to present to the Accounting Firm any material relating to the determination of the matters in dispute and to discuss such final determination by matters with the Arbiter shall not be subject to court review or otherwise appealableAccounting Firm. The fees Accounting Firm shall act as an expert and expenses not as an arbitrator to determine, based solely on the written submissions of the Arbiter pursuant to this Section 1.5(b) shall be borne by the CompanySeller, on the one hand, and Sellerthe Buyer, on the other handother, based upon and not by independent investigation, the percentage which amount or amounts in dispute, and shall be instructed that its determination (x) must be made in accordance with the aggregate portion Agreed Valuation Principles and (y) with respect to the total amount in dispute, must accept the amount proposed by either the Seller in the Dispute Notice or the Buyer in the Initial Statement. The Accounting Firm shall submit such calculation to the Buyer and the Seller as soon as practicable, but in any event within thirty (30) days after the remaining issues in dispute are submitted to the Accounting Firm. The determination by the Accounting Firm of the contested amount not awarded to Buyer and SellerFinal Adjustment Value, respectively, bears as set forth in a written notice delivered to the aggregate amount actually contested Seller and the Buyer by such partythe Accounting Firm in accordance with this Agreement absent manifest error will be binding and conclusive on the Seller and the Buyer. For example, if The Adjustment Value on the Closing Date that is final and binding on the Seller claims and the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 as determined either through agreement of the amount claimed by SellerSeller and the Buyer (deemed or otherwise) or pursuant to this Section 3.3, and if are referred to herein as the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested“Final Adjustment Value.”
(c) The fees, then the costs and expenses of the Arbiter will Accounting Firm shall be allocated 60% borne by (i.e., 300 ÷ 500i) the Buyer if the Accounting Firm selects the Seller’s position as to the Company amount in dispute or (ii) the Seller if the Accounting Firm selects the Buyer’s position as to the amount in dispute. To the extent that payment of the Accounting Firm’s fees, costs and 40% (i.e.expenses in advance of the resolution of the applicable dispute is required by the Accounting Firm, 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration Buyer and the Fundamental Change Repurchase Date (as Seller shall bear such term is defined in fees, costs and expenses equally; provided, however, that following the Senior Secured Notes Indenture) has not yet occurredresolution the Parties shall make any payments between them that are necessary to ensure that the fees, within five (5) Business Days after the Closing Statement becomes final costs and binding expenses are borne in accordance with the terms hereof, the Company first sentence of this Section 3.3(c).
(d) The Buyer shall, and Buyer shall cause the Company each of its Buying Affiliates to, make a payment its financial records available to the Note Escrow Account Seller and its accountants and other representatives, and the Seller shall, and shall cause each of its Selling Affiliates to, make its financial records available to the Buyer and its accountants and other representatives, in each case, as reasonably necessary for the Buyer and the Seller, as applicable, to perform their respective obligations under this Section 3.3 and at reasonable times during the period beginning on the Closing Date and ending on the date of the final determination of the Final Adjustment Value pursuant to Section 3.3(b), subject to customary indemnification and other agreements that may be requested by representatives of the Parties.
(e) The “Post-Closing Adjustment” shall be an amount equal to the amount by which Final Adjustment Value minus the Cash Consideration exceeds Closing Adjustment Value. If the Estimated Cash Consideration (up Post-Closing Adjustment is a positive amount, then the Buyer shall pay in cash to an excess equal to the Seller the amount of the Post-Closing Adjustment Escrow Amount) to an account or accounts designated by the Seller in writing by wire transfer of immediately available funds for purposes of making an offer within three Business Days after the Final Adjustment Value becomes such. If the Post-Closing Adjustment is a negative amount, then the Seller shall pay in cash to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to Buyer the amount of the Post-Closing Adjustment Escrow Amount) shall instead be paid to Seller (and held an account or accounts designated by the Buyer in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) writing by wire transfer of immediately available funds for purposes of making within three Business Days after the Final Adjustment Value becomes such. Any such payment shall be treated as an offer adjustment to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) purchase price paid for the sole purpose of complying with mandatory repurchase requirements set forth in Acquired Assets for all Tax purposes, to the Senior Secured Notes Supplemental Indenture with respect maximum extent permitted by applicable Law. If the Post-Closing Adjustment is zero, no amount shall be paid by either Party to any remaining 2025 Notesthe other Party pursuant to this Section 3.3(e).
Appears in 1 contract
Sources: Asset Purchase Agreement (Anixter International Inc)
Post-Closing Adjustment. (ai) Within ninety Before 5:00 p.m., Eastern Time, on the seventy-fifth (9075th) days following calendar day after the Closing DateEffective Time, the Buyer shall, or shall cause the Company to, prepare and deliver to Seller the Company Equityholder Representative a statement setting forth the Buyer’s calculation of the Closing Cash Consideration, including each component thereof (such amount, the “Preliminary Closing Cash Consideration” and such statement, the “Preliminary Closing Cash Consideration Statement”) setting in a manner consistent with the methodology and format set forth its in the Illustrative Closing Cash Consideration Statement. If the Buyer does not deliver the Preliminary Closing Cash Consideration Statement to the Company Equityholder Representative by 5:00 p.m., Eastern time, on the seventy-fifth (75th) calendar day after the Effective Time, then the Estimated Closing Cash Consideration shall be deemed for all purposes of this Agreement to be the “Final Closing Cash Consideration,” the Estimated Closing Cash Consideration Statement shall be deemed for all purposes of this Agreement to be the “Final Closing Cash Consideration Statement” and each shall be final and binding on all parties to this Agreement and on all Company Equityholders.
(ii) If the Company Equityholder Representative agrees in writing to Buyer’s calculation of the Closing Cash Consideration, as proposed in Buyer’s Preliminary Closing Cash Consideration and each Statement, then such Preliminary Closing Cash Consideration shall be deemed for all purposes of this Agreement to be the components thereof. The “Final Closing Cash Consideration,” such Preliminary Closing Cash Consideration Statement shall be prepared in good faith in accordance with the terms deemed for all purposes of this Agreement, including, as applicable, Agreement to be the Accounting Principles, “Final Closing Cash Consideration Statement” and the books each shall be final and records of binding on all parties to this Agreement and on all Company Equityholders.
(iii) If the Company and its Subsidiaries. During Equityholder Representative disputes the Preliminary Closing Cash Consideration as shown on Buyer’s Preliminary Closing Cash Consideration Statement, then the Company Equityholder Representative shall deliver to the Buyer within thirty (30) calendar days immediately following Sellerafter receipt of the Preliminary Closing Cash Consideration Statement a statement setting forth the Company Equityholder Representative’s calculation of the Closing Cash Consideration, including each component thereof (an “Objection Statement”). The Buyer and the Company Equityholder Representative shall seek in good faith to resolve such differences regarding the determination of the Closing Cash Consideration for a period of fifteen (15) calendar days after the Buyer’s receipt of the Closing Statement, Objection Statement from the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationsEquityholder Representative.
(bA) If the Buyer and the Company Equityholder Representative reach a timely Notice final resolution on the Closing Cash Consideration within fifteen (15) calendar days after the Buyer’s receipt of Disagreement is delivered the Objection Statement given by Sellerthe Company Equityholder Representative (or within any additional period as mutually agreed to between the Buyer and the Company Equityholder Representative), then the Closing Cash Consideration agreed upon by the Buyer and the Company Equityholder Representative shall be deemed for all purposes of this Agreement to be the “Final Closing Cash Consideration,” the corresponding statement calculating such Closing Cash
(B) If the Buyer and the Company Equityholder Representative do not reach a final resolution on the Closing Cash Consideration within fifteen (15) calendar days after the Buyer’s receipt of the Objection Statement (or within any additional period as revised mutually agreed to between the Buyer and the Company Equityholder Representative), then the Buyer and the Company Equityholder Representative shall be entitled to engage ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP (the “Neutral Accountant”) to determine, in the manner provided below, the Closing Cash Consideration, pursuant to an engagement agreement executed by the Company Equityholder Representative, the Buyer and the Neutral Accountant. The Company Equityholder Representative and the Buyer shall each be entitled to make a presentation to the Neutral Accountant, pursuant to procedures to be agreed to in good faith among the Company Equityholder Representative, the Buyer and the Neutral Accountant (or, if they cannot agree on such procedures, pursuant to procedures determined by the Neutral Accountant), regarding each of their respective calculations of the Closing Cash Consideration; and the Company Equityholder Representative and the Buyer shall instruct the Neutral Accountant to resolve such differences and determine the Closing Cash Consideration within twenty (20) Business Days after the completion of such presentations to the Neutral Accountant. Absent fraud or manifest error, or contravention with clause (C) below, the Neutral Accountant’s determination of the Closing Cash Consideration hereunder shall for all purposes of this Agreement be deemed to be the “Final Closing Cash Consideration,” the statement setting forth the Neutral Accountant’s calculation thereof shall for all purposes of this Agreement be deemed to be the “Final Closing Cash Consideration Statement” and each shall be final and binding on all parties to this Agreement and on all Company Equityholders.
(C) The Neutral Accountant shall not be authorized or permitted to: (1) determine any questions or matters whatsoever under or in connection with this Agreement except for the resolution of differences between the Company Equityholder Representative and the Buyer regarding the determination of the Closing Cash Consideration in accordance with this Section 1.5(b)2.6; (2) and resolve any such differences by making an adjustment to the resulting calculation Closing Cash Consideration or any component thereof that is outside of the range defined by amounts as finally proposed by the Buyer in the Preliminary Closing Cash Consideration shall become final and binding upon or the parties on the earlier of (i) the date any and all matters specified Company Equityholder Representative in the Notice of Disagreement Objection Statement; or (3) apply any accounting principles, policies, methods, treatments or procedures other than those that are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During GAAP (applied on a basis consistent with the thirty (30preparation of the Company Financial Statements) days immediately following and consistent with the delivery of a Notice of Disagreement or such longer period as Buyer methodology and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified format set forth in the Notice of DisagreementIllustrative Closing Cash Consideration Statement. In determining the Closing Cash Consideration hereunder, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) the Neutral Accountant shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting act as an expert and not an as arbitrator, shall make a final determination of the items included in the Closing Statement .
(to the extent such amounts are in disputeD) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall Neutral Accountant will be borne paid by the CompanyCompany Equityholders (out of the Escrow Fund), on the one hand, and Sellerby the Buyer, on the other hand, based upon in proportion to the percentage which variation between their respective positions and the aggregate portion determination of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerNeutral Accountant.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Post-Closing Adjustment. (a) Within As promptly as practicable, but in any event within ninety (90) days following after the Closing Date, Buyer shall, or Seller shall cause the Company to, prepare and deliver to Seller Buyer a statement combined balance sheet of the Business as of 11:59 p.m. in each local jurisdiction on the Closing Date together with a final closing statement, reflecting Seller’s good faith calculation of the Net Working Capital, the Closing Date Cash, the Closing Date Indebtedness, and the resulting Purchase Price (collectively, the “Final Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereof). The Final Closing Statement shall be prepared in good faith in accordance with the terms Calculation Principles, in a manner consistent with the Sample Closing Statement and accompanied by reasonable supporting documentation used by Seller in the preparation of the Final Closing Statement. Nothing in this AgreementSection 2.12 is intended to be used to adjust for errors, including, as applicableomissions or inconsistencies that may be found with respect to the Financial Statements, the Accounting Balance Sheet, or the Sample Closing Statement, or any actual or alleged failure of the Financial Statements, the Balance Sheet, or the Sample Closing Statement to be prepared in accordance with GAAP. The Parties shall not be permitted to introduce different accounting principles, procedures, policies, practices, estimates, judgments or methodologies in the preparation of the Final Closing Statement or the determination of the Net Working Capital, the Closing Date Cash, or the Closing Date Indebtedness from those set forth in the Calculation Principles.
(b) Buyer may dispute Seller’s calculations set forth in the Final Closing Statement (or any element thereof) by notifying Seller in writing, setting forth in reasonable detail the particulars of such disagreement (the “Notice of Objection”), within ninety (90) calendar days after Buyer’s receipt of the Final Closing Statement. Any item or amount as to which no dispute is raised in the Notice of Objection will be final, conclusive and binding on the Parties for all purposes hereunder. In the event that Buyer does not deliver a Notice of Objection to Seller within such ninety (90) calendar day period or Buyer accepts the Final Closing Statement in writing, Buyer shall be deemed to have accepted Seller’s calculation of the Final Purchase Price set forth in the Final Closing Statement and the Final Closing Statement (including the determination of the Purchase Price thereunder) shall be final and binding upon the Parties. In connection with the review by Buyer of the Final Closing Statement or any dispute pursuant to this Section 2.12, Seller shall (i) permit Buyer and its Representatives to have reasonable access to the books, records and other documents pertaining to or used in connection with the preparation of the Final Closing Statement and the calculation of the Net Working Capital, the Closing Date Cash, or the Closing Date Indebtedness, (ii) provide Buyer and its Representatives reasonable access to employees and accountants of Seller as reasonably requested by Buyer to verify the accuracy of the Final Closing Statement, and (iii) cause the books employees and records accountants of Seller to reasonably cooperate in all material respects in connection with such review. In the Company and its Subsidiaries. During event that a Notice of Objection is timely delivered, the Parties shall negotiate in good faith for a period of thirty (30) days immediately following after Seller’s receipt of the Closing StatementNotice of Objection, or such longer period as the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance noticeParties may agree in writing, to resolve any disagreements set forth in the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”Objection. Any communications between the Parties (or their respective Representatives) to Buyer prior to such date; provided that during the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the aforementioned thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered period shall be treated as settlement discussion materials pursuant to this Section 1.5(a) shall specify in reasonable detail the nature Federal Rule of Evidence 408 and amount of any disagreement so asserted and attach documentation supporting Seller’s calculationssimilar state rules.
(bc) If a timely Notice of Disagreement is delivered by Seller, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement Parties are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt unable to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of disagreement within such thirty (30) day period (or such longer period as Buyer and Seller may agree the Parties shall have agreed in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized then an independent accounting firm that is of recognized national standing as may be mutually selected by ▇▇▇▇▇ and Seller the Parties (the “ArbiterIndependent Firm”) for review and resolution. Buyer and Seller shall instruct the Arbiter tobe appointed, and the Arbiter, acting as an expert and not an arbitrator, to resolve any items that remain in dispute at the end of such period (the “Unresolved Items”), but in no case shall make a final determination of the items included Independent Firm review or propose any resolution for any matters that have not been raised in the Closing Statement Notice of Objection. If the Parties are not able to mutually select an independent accounting firm of recognized national standing within ten (10) days, then Seller shall within ten (10) days of such failure to agree deliver to Buyer a listing of three (3) accounting firms of nationally recognized standing (none of which have worked in the past three (3) years for Seller or Buyer or any of their respective Subsidiaries) and Buyer shall within ten (10) days after receipt of such list, select one of such three (3) accounting firms to act as the Independent Firm.
(d) The Parties shall instruct the Independent Firm to resolve the Unresolved Items as promptly as practicable, and in any event within ninety (90) days after the date on which such dispute is referred to the extent such amounts are in dispute) Independent Firm, based solely on the provisions of this Agreement, and the written submissions presentations by ▇▇▇▇▇ and Seller and in accordance with the guidelines Buyer, and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with In resolving any Unresolved Item, the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter Independent Firm (i) may not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned claimed by Buyer, on the one hand, or Seller, on the other hand, either Party or less than the smallest value for such item assigned claimed by Buyereither Party, on (ii) may not take oral testimony from the one handParties hereto or any other Person but may submit interrogatories to the Parties and receive written responses thereto, or Seller, on and (iii) shall not consider any facts that have occurred after the Closing Date. Seller and Buyer shall give each other handcopies of any written submissions at the same time as they are submitted to the Independent Firm. The Closing Statement Neither Buyer nor Seller shall have any ex parte communication with the Independent Firm. Seller shall bear and the resulting calculation pay a percentage of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant Independent Firm that is equal to this Section 1.5(b) shall be borne the percentage of the total dollar amount of changes to the Purchase Price proposed by the Company, on the one handBuyer that are successful, and Seller, on the other hand, based upon the Buyer shall bear and pay a percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs fees and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration Independent Firm that is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the percentage of the total dollar amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal of changes to the amount of the Adjustment Escrow Amount) Purchase Price proposed by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, Buyer that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Fundsare not successful, in each case, from as determined by the Adjustment Escrow Account.
Independent Firm. The written determination of the Independent Firm shall, as promptly as practicable, and in any event, within ninety (d90) Within five (5) Business Days days after its appointment, be delivered to the Parties and shall be final, conclusive and binding on the Parties and constitute an arbitral award, absent fraud or manifest error. Upon the decision of the Independent Firm, the Final Closing Statement becomes final as adjusted to the extent necessary to reflect any agreement between the Parties prior to or in lieu of submission to the Independent Firm and the Independent Firm’s decision, shall be final, conclusive and binding in accordance with on the terms hereof Parties and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurredconstitute an arbitral award, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notesabsent fraud or manifest error.
Appears in 1 contract
Sources: Stock and Asset Purchase Agreement (Jacobs Engineering Group Inc /De/)
Post-Closing Adjustment. (a) Within ninety (90) days following On or before November 30, 2007, the Closing Date, Buyer shall, or shall cause the Company to, Purchaser will prepare and deliver to the Seller a statement (with contemporaneous delivery to the Escrow Agent if the Purchaser claims that it is entitled to payment pursuant to Section 2.7(f)) written notice (the “Adjustment Notice”) containing (i) an unaudited balance sheet of the Seller as of the close of business on August 31, 2007 (the “Closing StatementBalance Sheet”), (ii) setting forth its the Purchaser’s calculation of the Cash Consideration Closing Net Working Capital based on the Closing Balance Sheet and each reflecting the exclusion of the components thereofExcluded Assets and Excluded Liabilities (the “Final Closing Net Working Capital”) and (iii) the Purchaser’s calculation of the amount of any payments required pursuant to Section 2.7(f) (the “Adjustment Calculation”). The Closing Statement shall Balance Sheet will be prepared in good faith in accordance with GAAP in a manner consistent with the terms of methods and practices used to prepare the Interim Balance Sheet without giving effect to any purchase accounting adjustments arising from the transactions contemplated by this Agreement, including, as applicable, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) Within 30 days after delivery of the Adjustment Notice, the Seller will deliver to the Purchaser (with contemporaneous delivery to the Escrow Agent if the Purchaser claims that it is entitled to payment pursuant to Section 2.7(f)) a written response in which the Seller will either:
(i) agree in writing with the Adjustment Calculation, in which case such calculation will be final and binding on the parties for purposes of Section 2.7(f); or
(ii) dispute the Adjustment Calculation by delivering to the Purchaser a written notice (a “Dispute Notice”) setting forth in reasonable detail the basis for each such disputed item and certifying that all such disputed items are being disputed in good faith. For purposes of this Section 2.7(b), the Seller (i) may only deliver a Dispute Notice on the basis that the Purchaser’s calculation of the Final Closing Net Working Capital does not properly reflect the exclusion of the Excluded Assets and Excluded Liabilities or was not in accordance with GAAP, applied in a manner consistent with the methods and practices used to prepare the Interim Balance Sheet without giving effect to any purchase accounting adjustments arising from the transactions contemplated by this Agreement, or that the Adjustment Calculation contains mathematical errors on its face and (ii) may not dispute any individual item relating to the Purchaser’s calculation of the Final Closing Net Working Capital having a value of less than $12,000.
(c) If a timely Notice the Seller fails to take either of Disagreement is delivered by Sellerthe foregoing actions within 30 days after delivery of the Adjustment Notice, then the Closing Statement (as revised Seller will be deemed to have irrevocably accepted the Adjustment Calculation, in accordance with this Section 1.5(b)) and which case, the resulting calculation of the Cash Consideration shall become Adjustment Calculation will be final and binding upon on the parties for purposes of Section 2.7(f).
(d) If the Seller timely delivers a Dispute Notice to the Purchaser, then the Purchaser and the Seller will attempt in good faith, for a period of 30 days, to agree on the earlier Adjustment Calculation for purposes of (i) Section 2.7(f). Any resolution by the Purchaser and the Seller during such 30-day period as to any disputed items will be final and binding on the parties for purposes of Section 2.7(f). If the Purchaser and the Seller do not resolve all disputed items by the end of 30 days after the date any of delivery of the Dispute Notice, then the Purchaser and all matters specified the Seller will submit the remaining items in the Notice of Disagreement are finally resolved in writing by dispute to ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇▇▇▇ LLP for resolution, or if that firm is unwilling or unable to serve, the Purchaser and the Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized will engage another mutually agreeable independent accounting firm that of recognized national standing, which firm is mutually selected by ▇▇▇▇▇ not the regular auditing firm of the Purchaser or the Seller. If the Purchaser and the Seller (are unable to jointly select such independent accounting firm within 10 days after such 30-day period, the “Arbiter”) for review and resolution. Buyer and Seller shall instruct Purchaser, on the Arbiter toone hand, and the ArbiterSeller, acting as on the other hand, will each select an expert independent accounting firm of recognized national standing and each such selected accounting firm will select a third independent accounting firm of recognized national standing, which firm is not an arbitrator, shall make a final determination the regular auditing firm of the items included in Purchaser or the Closing Statement (to Seller; provided, however, that if either the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by BuyerPurchaser, on the one hand, or the Seller, on the other hand, or less than fail to select such independent accounting firm during this 10-day period, then the smallest value for such item assigned parties agree that the independent accounting firm selected by Buyer, on the one hand, or Seller, on the other handparty will be the independent accounting firm selected by the parties for purposes of this Section 2.7 (such selected independent accounting firm, whether pursuant to this sentence or the preceding sentence, the “Independent Accounting Firm”). The Closing Statement Purchaser and the Seller will instruct the Independent Accounting Firm to render its determination with respect to the items in dispute in a written report that specifies the conclusions of the Independent Accounting Firm as to each item in dispute and the resulting calculation Adjustment Calculation. The Purchaser and the Seller will each use their commercially reasonable efforts to cause the Independent Accounting Firm to render its determination within 30 days after referral of the Cash Consideration shall become items to such firm or as soon thereafter as reasonably practicable. The Independent Accounting Firm’s determination of the Adjustment Calculation as set forth in its report will be final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ for purposes of Section 2.7(f). The Purchaser will revise the Closing Balance Sheet and Seller, on the date calculation of the Arbiter delivers its final determination Final Closing Net Working Capital as appropriate to reflect the resolution of the issues in writing dispute pursuant to Buyer this Section 2.7(d) and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller the Purchaser will provide instructions to be delivered not more than thirty (30) days following submission of the Escrow Agent consistent with such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealableresolution. The fees and expenses of the Arbiter Independent Accounting Firm will be shared by the Purchaser and the Seller in inverse proportion to the relative amounts of the disputed amount determined to be for the account of the Purchaser and the Seller, respectively.
(e) For purposes of complying with this Section 2.7, the Purchaser and the Seller will furnish to each other and to the Independent Accounting Firm such work papers and other documents and information relating to the disputed issues as the Independent Accounting Firm may request and are available to that party (or its independent public accountants) and will be afforded the opportunity to present to the Independent Accounting Firm any material related to the disputed items and to discuss the items with the Independent Accounting Firm. The Purchaser may require that the Independent Accounting Firm enter into a customary form of confidentiality agreement with respect to the work papers and other documents and information regarding the Seller provided to the Independent Accounting Firm pursuant to this Section 1.5(b2.7.
(f) shall be borne by If the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded Final Closing Net Working Capital as finally determined pursuant to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration this Section 2.7 is $1,000 greater less than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contestedEstimated Closing Net Working Capital, then the costs and expenses of the Arbiter Seller will be allocated 60% (i.e., 300 ÷ 500) pay to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) Purchaser the amount of such difference in cash without interest thereon. If the Cash Consideration Final Closing Net Working Capital as finally determined pursuant to this Section 2.7 is greater than the Estimated Cash Consideration and Closing Net Working Capital, then the Fundamental Change Repurchase Date Purchaser will pay to the Seller the amount of such difference in cash without interest thereon.
(as such term is defined in the Senior Secured Notes Indentureg) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a Any payment to the Note Purchaser pursuant Section 2.7(f) will first be satisfied by payment from the Escrow Account Account. The Seller and each Member (severally up to such Member’s pro rata portion of an amount equal to the Purchase Price based on its ownership percentage interest in the Seller) will be liable for any amount by which the Cash Consideration any payment required under Section 2.7(f) exceeds the Estimated Cash Consideration (up to an excess equal to the amount then-balance of the Adjustment Escrow Amount) Account, which payment will be effected by wire transfer of immediately available funds for purposes of making an offer to repurchase from the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up Seller to an excess equal account designated by the Purchaser, and any payment to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c2.7(f) (if any) will be effected by wire transfer of immediately available funds for purposes to an account designated by the Seller. Such payments will be made on or before the date that is 5 business days following the final determination of making an offer to repurchase the 2026 Notes and the 2025 Notes Final Closing Net Working Capital in accordance with this Section 1.82.7.
(h) The purpose of this Section 2.7 is to determine the final Purchase Price to be paid by the Purchaser under this Agreement. Accordingly, any adjustment pursuant hereto will neither be deemed to be an indemnification pursuant to Article 9, nor preclude the Purchaser from exercising any indemnification rights pursuant to Article 9; provided, however, that if in no event will the Fundamental Change Repurchase Date has occurredSeller or the Members be obligated to indemnify any Purchaser Indemnified Party for any Loss as a result of, or based upon or arising from, any Liability, to the remaining Adjustment Escrow Funds shall instead extent, but only to the extent, such Liability is reflected in the calculation of the Final Closing Net Working Capital as finally determined pursuant to this Section 2.7. Any payment made pursuant to this Section 2.7 will be released treated by the parties for all purposes as an adjustment to Seller (the Initial Purchase Price and held in a deposit account will not be subject to a control agreement offset for any reason. The Initial Purchase Price as so adjusted is referred to in favor of this Agreement as the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes“Purchase Price.”
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Sources: Asset Purchase Agreement (Nova Biosource Fuels, Inc.)
Post-Closing Adjustment. (a) Within As soon as practicable, but in no event later than ninety (90) days following the Closing Date, Buyer shall, on a basis consistent with the methods, principles, practices and policies employed in the preparation and presentation of the Financial Statements and, where applicable, the Cybertel Cellular Expenditure Budgets or shall cause the Company toCybertel RSA Pro Forma Expenditure Budgets, as the case may be, prepare and deliver to Seller a statement (the “"Closing Statement”") setting forth its showing the calculation of the Cash Consideration Closing Working Capital, the Closing Long Term Liabilities and each the EBITDA Subscriber Amount (the "Calculation").
(b) After receipt of the components thereofCalculation, Seller shall have 30 days to review the Calculation. The Closing Statement Buyer shall be prepared provide Seller and its authorized representatives reasonable access during normal business hours and without significant disruption to the Business, to (1) all books, records and employees of Buyer and its Subsidiaries having relevant information concerning the Calculation to the extent that such information was used in good faith the Calculation and (2) Buyer's accountants who assisted Buyer in accordance preparing the Calculation and such accountants' relevant supporting workpapers. Unless Seller delivers written notice to Buyer on or prior to the 30th day after Buyer's delivery of the Calculation stating that Seller has objections to the Calculation and describing any such objections with the terms of this Agreement, including, as applicable, the Accounting Principles, and reasonable particularity (including a basis in the books and records of the Company Companies or accounting principles for such objection), Seller shall be deemed to have accepted and its Subsidiaries. During the thirty (30) days immediately following Seller’s receipt of the Closing Statement, the Company shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, agreed to the books Calculation. In addition, any item included in the Calculation which is not objected to by Seller shall be deemed to be accepted by Seller ("Resolved Items") and records of the Company for purposes of their review of the Closing Statementany amounts included within such item shall be deemed to be final, binding and conclusive. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless If Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to notifies Buyer of its acceptance of objections to the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by SellerCalculation, then the Closing Statement (as revised in accordance with this Section 1.5(b)) and the resulting calculation of the Cash Consideration shall become final and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) shall, within 10 days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller the parties may agree in writingagree) following such notice (the "Resolution Period"), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement attempt to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter toresolve their differences, and the Arbiter, acting any written resolution by them as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination disputed amounts shall be requested by ▇▇▇▇▇ final, binding and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Sellerconclusive.
(c) If Any amounts remaining in dispute at the Cash Consideration is greater than conclusion of the Estimated Cash Consideration Resolution Period ("Unresolved Items") shall be submitted to KPMG LLP (such firm being referred to as the "CPA Firm") or, if such firm shall be unable or unwilling to serve in such capacity or if the parties shall otherwise mutually agree, such other nationally recognized firm of independent accountants mutually agreed by Seller and Buyer (and, in such case, such firm shall be deemed to be the CPA Firm), within 10 days after the expiration of the Resolution Period. Each party agrees to execute, if requested by the CPA Firm, an engagement letter with the CPA Firm containing reasonable terms. All fees and expenses relating to the work, if any, to be performed by the CPA Firm shall be borne by Seller and Buyer in inverse proportion to the allocation of the dollar amount of the Unresolved Items made by the CPA Firm in favor of Seller or Buyer, as the case may be. The CPA Firm shall act as an arbitrator and not as an expert to determine, based on the provisions of this Section 2.5, only the Unresolved Items. The CPA Firm's determination of the Unresolved Items shall be made within 30 days of the submission of the Unresolved Items to the CPA Firm, and, together with a calculation of the Closing Working Capital, the Closing Long Term Liabilities and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to EBITDA Subscriber Amount based upon the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes Resolved Items and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount CPA Firm's determinations of the Adjustment Escrow Amount) Unresolved Items, shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in a written statement delivered to Seller and Buyer by the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If CPA Firm and shall be final, binding and conclusive on the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Accountparties for all purposes.
(d) Within five (5) Business Days after following either (i) an agreement by Buyer and Seller as to the Closing Statement becomes Working Capital, the Closing Long Term Liabilities and the EBITDA Subscriber Amount or (ii) the CPA Firm's determination of the Closing Working Capital, the Closing Long Term Liabilities and the EBITDA Subscriber Amount, Seller shall pay to Buyer the amount, if any, by which the Estimated Purchase Price exceeds the final and binding calculation of the Purchase Price determined in accordance with Section 2.2 after resolution of all disputed items, or Buyer shall pay to Seller the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurredamount, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any, by which the final calculation of the Purchase Price exceeds the Estimated Purchase Price (the "Post-Closing Adjustment").
(e) after any Any payments are made to Buyer pursuant to this Section 1.5(c) (if any) 2.5 shall be made by wire transfer of immediately available funds to an account indicated in writing by the party to receive such funds and shall be accompanied by interest at the Applicable Rate calculated on the basis of a year of 360 days for purposes the actual number of making an offer days elapsed, accrued from the Closing Date up to repurchase and including the 2026 Notes and date of payment.
(f) Any payments made in respect of the 2025 Notes Post-Closing Adjustment shall be deemed to be adjustments to the Cybertel Purchase Price or the GSAA Purchase Price in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor portion of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.adjustment pursuant to
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Post-Closing Adjustment. (ai) Within ninety forty-five (9045) days following after the Closing Date, Buyer shall, or shall cause the Company to, prepare and deliver to Seller a statement statement, certified by an authorized officer of the Buyer, setting forth Buyer’s good faith calculation of the Cash Consideration, along with a summary showing in reasonable detail each calculation of the components thereof (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each of the components thereof). The Closing Statement shall will be prepared in good faith in accordance a manner consistent with the definitions of the terms of this AgreementCash on Hand, includingIndebtedness, as applicableWorking Capital, the Accounting Principles, Bonus Amounts and Selling Expenses and the books accounting principles and records practices referred to therein. The Closing Statement will entirely disregard (A) any and all effects on the assets or liabilities of the Company and its Subsidiaries. During Subsidiaries as a result of the thirty transactions contemplated hereby or of any financing or refinancing arrangements entered into at any time by Buyer or any other transaction entered into by Buyer in connection with the consummation of the transactions contemplated hereby and (30B) days immediately following Seller’s any of the plans, transactions or changes which Buyer intends to initiate or cause to be initiated or made after Closing with respect to the Company and its Subsidiaries or their business or assets, or any facts or circumstances that are unique or particular to Buyer or any of its assets or liabilities.
(ii) After receipt of the Closing Statement, Seller shall have forty-five (45) days (the Company shall provide “Review Period”) to review the Closing Statement. During the Review Period, Seller and its accountants and representatives with reasonable access, during normal business hours and after reasonable advance notice, shall have full access to the books and records of the Company, the personnel of, and work papers prepared by, the Company and/or its accountants or representatives for purposes the purpose of their review reviewing the Closing Statement and to such historical financial information and other information (to the extent in Buyer’s control or possession) relating to the Closing Statement as Seller may reasonably request for the purpose of reviewing the Closing Statement and to prepare a Statement of Objections (defined below), provided, that such access shall be in a manner that does not materially interfere with the normal business operations of Buyer or the Company.
(iii) On or prior to the last day of the Review Period, the Seller may object to the Closing StatementStatement by delivering to Buyer a written statement setting forth its objections in reasonable detail, indicating each disputed item or amount and the basis for its disagreement therewith (the “Statement of Objections”). The If the Seller fails to deliver the Statement of Objections before the expiration of the Review Period, the Closing Statement and the resulting calculation Post-Closing Adjustment, as the case may be, reflected in the Closing Statement shall be deemed to have been accepted by the Seller. If the Seller delivers the Statement of Objections before the expiration of the Cash Consideration Review Period, the Buyer and the Seller shall become final and binding upon the parties hereto negotiate in good faith to resolve such objections within thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice after the delivery of its disagreement the Statement of Objections (a the “Notice of DisagreementResolution Period”) to Buyer prior to such date; provided that ), and, if the same are so resolved within the Resolution Period, the Post-Closing Adjustment and the Closing Statement with such changes as may have been previously agreed in writing by the Buyer and the resulting calculation Seller, shall be final and binding.
(iv) If the Seller and the Buyer fail to reach an agreement with respect to all of the Cash Consideration shall become final and binding upon matters set forth in the parties upon Seller’s delivery, prior to the Statement of Objections before expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by SellerResolution Period, then any amounts remaining in dispute (the Closing Statement (“Disputed Amounts”, with any amounts not so disputed being the “Undisputed Amounts”), shall be submitted for resolution to the office of an impartial nationally recognized firm of independent certified public accountants, as revised in accordance with this Section 1.5(b)) may be mutually acceptable to the Buyer and the resulting calculation of Seller (the Cash Consideration “Independent Accountant”), who, acting as experts and not arbitrators, shall become final resolve the Disputed Amounts only and binding upon make any adjustments to the parties Post-Closing Adjustment, as the case may be. The Independent Accountant will make its determination based solely on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved presentations by Buyer and Seller that are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer The parties hereto agree that all adjustments shall be made without regard to materiality. The Independent Accountant shall only decide the specific items under dispute by the parties and Seller shall cooperate with their decision for each Disputed Amount must be within the Arbiter during the term range of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value values assigned to any each such item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation Statement of the Cash Consideration Objections, respectively. The Independent Accountant shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final make a determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than as soon as practicable within thirty (30) days following submission of (or such disputed matters)other time as the parties hereto shall agree in writing) after its engagement, and such final determination by its resolution of the Arbiter Disputed Amounts and its adjustments to the Post-Closing Adjustment shall not be subject to court review or otherwise appealable. conclusive and binding, absent manifest error, upon the parties hereto.
(v) The fees and expenses of the Arbiter pursuant to this Section 1.5(b) Independent Accountant shall be borne paid by the CompanySeller, on the one hand, and Sellerby the Buyer, on the other hand, based upon the percentage which that the aggregate portion of the amount actually contested amount but not awarded to Buyer and Sellerthe Seller or the Buyer, respectively, bears to the aggregate amount actually contested by such party. For example, if the Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow AccountBuyer.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
Appears in 1 contract
Post-Closing Adjustment. (a) Within ninety (90) 45 days following the Closing Date, Buyer shall, or the Sellers’ Representatives shall cause the Company to, prepare in good faith and deliver to Seller a Buyer the statement (the “Closing Statement”) setting that sets forth its calculation as of the Cash Consideration and each of Closing Date the components thereof. The Closing Statement shall be prepared in good faith in accordance with the terms of this Agreement, including, as applicable, the Accounting Principles, and the books and records Working Capital of the Company and its Subsidiaries. During The Working Capital shall be prepared in accordance with GAAP and consistent with the thirty Consolidated Company Accounting Principals. Following the Closing, the Company and Buyer shall provide, upon reasonable notice, Sellers’ Representatives and its Representatives (30as defined in Section 5.2(a) hereof) full access to the properties, books, records, work papers and personnel of the Company and shall cooperate fully with Sellers’ Representatives for purposes of preparing the Closing Statement. Buyer shall have 30 days immediately following Seller’s receipt after delivery to Buyer of the Closing Statement during which to notify Sellers’ Representatives of any dispute of any item contained in the Closing Statement, the Company which notice shall provide Seller and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify set forth in reasonable detail the nature basis for such dispute and amount Buyer’s good faith calculation of Working Capital. If Buyer fails to notify the Sellers’ Representatives of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by Sellersuch dispute within such 30-day period, then the Closing Statement shall be deemed to be the final statement (“Final Statement”). In the event that Buyer shall so notify the Sellers’ Representatives of any dispute, Buyer and the Sellers’ Representatives and their respective accountants shall cooperate in good faith to resolve such dispute as revised promptly as possible. “Working Capital” shall mean the sum of Current Assets less Current Liabilities “Current Assets” shall mean the current assets of the Company and its Subsidiaries as set forth on a balance sheet prepared in accordance with this Section 1.5(b)GAAP (including cash and cash equivalents) and consistent with the resulting calculation Consolidated Company Accounting Principles. “Current Liabilities” shall mean the current liabilities of the Cash Consideration shall become final Company and binding upon its Subsidiaries as set forth on a balance sheet prepared in accordance with GAAP and consistent with the parties on Consolidated Company Accounting Principles, excluding therefrom any liabilities associated with purchasing the earlier D&O Tail Policy (as defined herein), procuring the Reviewed Financial Statements and the Audited Financial Statements as contemplated by Section 5.16 hereof, the legal fees incurred by the Company in connection with the transactions contemplated by this Agreement to the extent paid pursuant to Section 10.5 out of (i) the date any and all matters specified in Purchase Price, the Notice of Disagreement are finally resolved in writing by fees payable to L▇▇▇▇▇ Brothers as contemplated by Sections 2.19 and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised 10.5 hereof to the extent necessary paid pursuant to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 10.5 out of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter toPurchase Price, and the ArbiterStudier Payment. For the avoidance of doubt, acting as an expert and not an arbitrator, the Population Council liabilities shall make a final determination of the items included be accounted for in the Closing Statement (to same manner as by the extent such amounts are Company in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to SellerTarget Working Capital.
(c) If the Cash Consideration is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, the Company shall, and Buyer shall cause the Company to, make a payment to the Note Escrow Account of an amount equal to the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
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Post-Closing Adjustment. (ai) Within ninety (90) sixty days following after the Closing Date, Buyer shall, or the Seller shall cause the Company to, prepare and deliver to Seller the Buyer a statement (the “Closing Statement”) setting forth its calculation of the Cash Consideration and each Closing Working Capital, which statement shall contain a balance sheet of the components thereof. The Business as of the Closing Statement Date (without giving effect to the transactions contemplated herein except that the $56,000 of inventory discussed in Section 2(g) below shall be reduced from Closing Working Capital) (the “Closing Balance Sheet”), a calculation of Closing Working Capital (the “Closing Working Capital Statement”) and a certificate of the Seller that the Closing Balance Sheet and Closing Working Capital Statement were prepared in good faith in accordance with the terms same accounting methods, practices, principles, policies and procedures used by the Seller, including consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of this Agreement, including, the Most Recent Financial Statements for the most recent fiscal year end as applicableif such Closing Balance Sheet and Closing Working Capital Statement were being prepared as of a fiscal year end. Upon receipt, the Accounting Principles, and the books and records of the Company and its Subsidiaries. During the thirty (30) Buyer shall have twenty days immediately following Seller’s receipt of to review the Closing Statement, the Company shall provide Seller Balance Sheet and its representatives with reasonable access, during normal business hours and after reasonable advance notice, to the books and records of the Company for purposes of their review of the Closing Statement. The Closing Working Capital Statement and either approve or dispute the resulting calculation of the Cash Consideration shall become final and binding upon the parties hereto thirty (30) days following Seller’s receipt thereof unless Seller delivers written notice of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date; provided that the Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding upon the parties upon Seller’s delivery, prior to the expiration of the thirty (30) day period, of written notice to Buyer of its acceptance of the Closing Statement. Any Notice of Disagreement delivered pursuant to this Section 1.5(a) shall specify in reasonable detail the nature and amount of any disagreement so asserted and attach documentation supporting Seller’s calculations.
(b) If a timely Notice of Disagreement is delivered by . In the event the Buyer approves the calculations, the Buyer shall determine the Post-Closing Adjustment and deliver to the Seller. In the event the Buyer disputes the calculations, then the Closing Statement (as revised in accordance with this Section 1.5(b)) Buyer and the resulting calculation Seller shall have up to ten Business Days from the date Buyer notifies Seller of the Cash Consideration dispute to cooperate to mutually determine an acceptable Closing Balance Sheet and Closing Working Capital Statement calculation. Upon such determination, the Buyer shall become final determine the Post-Closing Adjustment and binding upon the parties on the earlier of (i) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by ▇▇▇▇▇ and Seller and (ii) the date any and all matters specified in the Notice of Disagreement not resolved by Buyer and Seller are finally resolved in writing by the Arbiter (as defined below). The Closing Statement shall be revised deliver to the extent necessary to reflect any resolution agreed to by ▇▇▇▇▇ and Seller or any final resolution determined by the Arbiter in accordance with this Section 1.5. During the thirty (30) days immediately following the delivery of a Notice of Disagreement or such longer period as Buyer and Seller may agree in writing, Buyer and Seller may attempt to resolve any differences which they may have with respect to any matter specified in the Notice of Disagreement, and all such discussions related thereto (unless otherwise agreed by ▇▇▇▇▇ and Seller) shall be governed by Rule 408 of the Federal Rules of Evidence and any applicable similar Law. At the end of such thirty (30) day period (or such longer period as Buyer and Seller may agree in writing), Buyer and Seller shall submit any and all matters (but only such matters) which remain in dispute and which were properly included in the Notice of Disagreement to a nationally-recognized independent accounting firm that is mutually selected by ▇▇▇▇▇ and Seller (the “Arbiter”) for review and resolution. Buyer and Seller shall instruct the Arbiter to, and the Arbiter, acting as an expert and not an arbitrator, shall make a final determination of the items included in the Closing Statement (to the extent such amounts are in dispute) based solely on written submissions by ▇▇▇▇▇ and Seller and in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis of an independent review). Buyer and Seller shall cooperate with the Arbiter during the term of its engagement. Buyer and Seller shall instruct the Arbiter not to, and the Arbiter shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or Seller, on the other hand. The Closing Statement and the resulting calculation of the Cash Consideration shall become final and binding on the parties hereto, if not already mutually agreed by ▇▇▇▇▇ and Seller, on the date the Arbiter delivers its final determination in writing to Buyer and Seller (which final determination shall be requested by ▇▇▇▇▇ and Seller to be delivered not more than thirty (30) days following submission of such disputed matters), and such final determination by the Arbiter shall not be subject to court review or otherwise appealable. The fees and expenses of the Arbiter pursuant to this Section 1.5(b) shall be borne by the Company, on the one hand, and Seller, on the other hand, based upon the percentage which the aggregate portion of the contested amount not awarded to Buyer and Seller, respectively, bears to the aggregate amount actually contested by such party. For example, if Seller claims the Cash Consideration is $1,000 greater than the amount determined by Buyer, and ▇▇▇▇▇ contests only $500 of the amount claimed by Seller, and if the Arbiter ultimately resolves the dispute by awarding Seller $300 of the $500 contested, then the costs and expenses of the Arbiter will be allocated 60% (i.e., 300 ÷ 500) to the Company and 40% (i.e., 200 ÷ 500) to Seller.
(cii) If the Cash Consideration Post-Closing Adjustment is greater than the Estimated Cash Consideration and the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereofa positive number, the Company shall, and Buyer shall cause the Company to, make a payment pay to the Note Escrow Account of Seller an amount equal to the Post-Closing Adjustment. If the Post-Closing Adjustment is a negative number, the Seller shall pay to Buyer an amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount Post-Closing Adjustment.
(iii) Any payment of the Post-Closing Adjustment, together with interest calculated as set forth below, shall be due within ten Business Days of the delivery of the Post-Closing Adjustment Escrow Amount) and shall be paid by wire transfer of immediately available funds for purposes to such account as is directed by B▇▇▇▇. The amount of making an offer any Post-Closing Adjustment shall bear interest from and including the Closing Date to repurchase but excluding the 2026 Notes date of payment at a rate per annum equal to 8%. Such interest shall be calculated daily on the basis of a 365-day year and the 2025 Notes in accordance with Section 1.8; providedactual number of days elapsed. In the event the Seller does not make a required Post-Closing Adjustment payment, that if such amount (including any accrued but unpaid interest) shall be reduced from the Fundamental Change Repurchase Date has occurred, the amount by which the Cash Consideration exceeds the Estimated Cash Consideration (up to an excess equal to the amount of the Adjustment Escrow Amount) shall instead be paid to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes. If the Estimated Cash Consideration is greater than the Cash Consideration, within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof, Buyer and the Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make payment to Buyer (or its designees) of an amount equal to the lesser of (i) an amount equal to the amount by which the Estimated Cash Consideration exceeds the Cash Consideration, and (ii) the Adjustment Escrow Funds, in each case, from the Adjustment Escrow Account.
(d) Within five (5) Business Days after the Closing Statement becomes final and binding in accordance with the terms hereof and if the Fundamental Change Repurchase Date (as such term is defined in the Senior Secured Notes Indenture) has not yet occurred, Buyer and Seller shall cause the Escrow Agent (including by delivering joint written instructions to the Escrow Agent) to make a payment from the Adjustment Escrow Account to the Note Escrow Account of an amount equal to the remaining Adjustment Escrow Funds (if any) after any payments are made to Buyer pursuant to Section 1.5(c) (if any) by wire transfer of immediately available funds for purposes of making an offer to repurchase the 2026 Notes and the 2025 Notes in accordance with Section 1.8; provided, that if the Fundamental Change Repurchase Date has occurred, the remaining Adjustment Escrow Funds shall instead be released to Seller (and held in a deposit account subject to a control agreement in favor of the Consenting Noteholders) for the sole purpose of complying with mandatory repurchase requirements set forth in the Senior Secured Notes Supplemental Indenture with respect to any remaining 2025 Notes.
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