Common use of Preparation of Closing Balance Sheet Clause in Contracts

Preparation of Closing Balance Sheet. On or before the 60th day after the Closing Date, personnel of the Buyer and an accounting firm engaged by the Buyer (the "Buyer's Accountant") will prepare and deliver to the Stockholder Representative an audited balance sheet of the Company as of the close of business on the Closing Date (the "Closing Date Balance Sheet"), together with an unqualified report of the Buyer's Accountant thereon, and a certificate of the chief financial officer of the Buyer setting forth the Buyer's determination of the EXECUTION COPY Working Capital as of the Closing Date (the "Adjustment Statement"). The Closing Date Balance Sheet shall be prepared from the Company's books and records in accordance with the accounting principles set forth in subsection (e) below taking into account the payments to be made by the Company in connection with the Closing (including the fees and expenses and Taxes described in Section 11.8). During the preparation of the Closing Date Balance Sheet and all activities in connection therewith, the Stockholder Representative will be entitled to designate a representative (the "Representative Accountant") to observe and comment on the preparation of the Closing Date Balance Sheet and the Adjustment Statement and procedures relating thereto and shall have the right to review the work papers prepared in connection therewith. On or prior to the 20th day after the Stockholder Representative's receipt of the Closing Date Balance Sheet and the Adjustment Statement, the Stockholder Representative may give the Buyer a written notice stating in reasonable detail the Stockholder Representative's objections (an "Objection Notice") to the Closing Date Balance Sheet and/or the Adjustment Statement. If the Stockholder Representative does not tender to the Buyer an Objection Notice within such 20-day period, then the Closing Date Balance Sheet and the Adjustment Statement will be conclusive and binding upon the Parties and the Working Capital as of the Closing Date determined therefrom will likewise be binding on the Parties for purposes of Section 2.4(d) below.

Preparation of Closing Balance Sheet. On or before As promptly as practicable following the 60th day after Closing, but in no event later than 60 days subsequent to the Closing Date, personnel Fiserv and Buyer shall deliver to Seller a schedule (the “Final Schedule”) of Fiserv’s and Buyer’s calculation, which shall be derived from a balance sheet (the “Closing Balance Sheet”) prepared using the same accounting principles, procedures, policies and methods that were used to prepare the Company Financial Statements, of the amount, if any, by which the Total Shareholders Equity is greater (less) than $8,000,000 (the aggregate adjustment amount being hereinafter referred to as the “Final Adjustment Figure”). If Seller disputes the correctness of the Final Schedule or the Closing Balance Sheet, Seller shall notify Fiserv and Buyer of its objections within 30 days after delivery of the Final Schedule and shall set forth in reasonable detail in such notice the reason for Seller’s objections. If Seller fails to deliver such notice within such time period, Seller shall be deemed to have accepted the Final Adjustment Figure and the Closing Balance Sheet. If Seller delivers such notice, Fiserv, Buyer and an accounting firm engaged by Seller shall endeavor in good faith to resolve their dispute over the Buyer (the "Buyer's Accountant") will prepare and deliver to the Stockholder Representative an audited balance sheet of the Company as of the close of business on the Closing Date (the "Closing Date Balance Sheet"), together with an unqualified report of the Buyer's Accountant thereon, and a certificate of the chief financial officer of the Buyer setting forth the Buyer's determination of the EXECUTION COPY Working Capital as of Final Adjustment Figure or the Closing Date (Balance Sheet, as the "Adjustment Statement"). The Closing Date Balance Sheet shall be prepared from the Company's books and records in accordance with the accounting principles set forth in subsection (e) below taking into account the payments to be made by the Company in connection with the Closing (including the fees and expenses and Taxes described in Section 11.8). During the preparation of the Closing Date Balance Sheet and all activities in connection therewithcase may be, the Stockholder Representative will be entitled to designate a representative (the "Representative Accountant") to observe and comment on the preparation of the Closing Date Balance Sheet and the Adjustment Statement and procedures relating thereto and shall have the right to review the work papers prepared in connection therewith. On or prior to the 20th day within 30 days after the Stockholder Representative's receipt of the Closing Date Balance Sheet such notice by Fiserv and the Adjustment Statement, the Stockholder Representative may give the Buyer a written notice stating in reasonable detail the Stockholder Representative's objections (an "Objection Notice") to the Closing Date Balance Sheet and/or the Adjustment StatementBuyer. If the Stockholder Representative does not tender they are unable to the Buyer an Objection Notice do so within such 2030-day period, then the Closing Date Balance Sheet dispute shall be submitted to an audit partner experienced in the financial institution processing services industry of PricewaterhouseCoopers LLP (“PWC”) so long as PWC is independent of both Fiserv and Seller, or, if PWC shall cease to be independent of Fiserv and Seller, another independent nationally-recognized accounting firm in the United States as shall be mutually acceptable to Fiserv, Buyer and Seller (PWC or such other accounting firm, an “Independent Accountant”), who shall act as an expert and not as an arbitrator, and who shall resolve the dispute within ten days. The Independent Accountant shall make a determination based solely on presentations by Fiserv and Buyer, on the one hand, and Seller, on the other hand, and not by independent review, as to (and only as to) each of the items in dispute, and shall be instructed that, in resolving such items in dispute, it must select a position with respect to the Final Adjustment Statement will Figure that is either exactly the position of Fiserv and Buyer or exactly the position of Seller or that is between such position of Fiserv and Buyer and such position of Seller. The decision of the Independent Accountant as to the Final Adjustment Figure shall be conclusive final and binding upon the Parties parties. The expense of the Independent Accountant shall be borne by Fiserv and Buyer, on the one hand, and Seller, on the other hand, in proportion to the relative difference between such party’s position and the Working Capital as determination of the Independent Accountant. Fiserv, Buyer and Seller shall cooperate with the other party in the determination of the Final Adjustment Figure and the Closing Date determined therefrom will likewise be binding on Balance Sheet, including allowing Seller access after the Parties Closing to the books and records of the Company and to the accounting and other representatives and advisors of the Company and its books and records for the purposes of Section 2.4(d) belowmaking such determination.

Preparation of Closing Balance Sheet. (a) On or before about November 17, 2000, the 60th day after the Closing DateCompany has taken a physical inventory of all merchandise, personnel materials and products of the Buyer and an accounting firm engaged by Business as of the Buyer close of business (the "BuyerInventory"). (b) Promptly after the Closing, Seller's Accountant") will accountants shall prepare and deliver to the Stockholder Representative an audited a consolidated closing balance sheet of the Company (the "Closing Balance Sheet") as of the close of business on the Closing Date (Date. Amounts on the "Closing Date Balance Sheet"), together Sheet with an unqualified report of respect to inventories shall be derived from the Buyer's Accountant thereonInventory, and a certificate of the chief financial officer of the Buyer setting forth the Buyer's determination of the EXECUTION COPY Working Capital as of if necessary, rolled forward to the Closing Date (based upon the "Adjustment Statement")Company's books and records. The Closing Date Balance Sheet shall be prepared from the Company's books and records in accordance with the United States generally accepted accounting principles set forth in subsection and practices (e"GAAP") below taking into account (the payments "Accounting Principles") and delivered to be made by the Company in connection with Rheometric within thirty (30) days of the Closing Date. Rheometric and its authorized representatives and designees, shall review the Closing Balance Sheet and ▇▇▇▇▇▇▇ & ▇▇▇▇▇ and/or its United Kingdom affiliate (including "Rheometric's Accountants") shall perform an audit of the Closing Balance Sheet prepared by Seller's Accountants. The Closing Balance Sheet, as adjusted as a result of such audit, shall be submitted to Sellers as soon as practicable after the Closing and in all events within thirty (30) days after delivery of the Closing Balance Sheet prepared by Sellers' Accountants. (c) Sellers shall be deemed to have accepted the audited Closing Balance Sheet unless within thirty (30) days after delivery thereof to Sellers, they give written notice to Rheometric of Sellers' objection to any item therein. In the event Sellers give such written notice of objection, and Rheometric and Sellers have been unable to resolve such dispute by a date twenty (20) days after delivery of such notice of objection, either party may require that such dispute be resolved by one arbitrator (the "Arbitrator") who shall be a certified public accountant and a partner in the London office of a "Big Five" accounting firm. The Arbitrator shall have access to all documents and facilities necessary to perform its function as Arbitrator. The Arbitrator's determination with respect to any dispute shall be final and binding upon the parties hereto. Sellers and Rheometric shall each pay one-half of the fees and expenses and Taxes described in Section 11.8). During the preparation of the Closing Date Balance Sheet and all activities in connection therewith, the Stockholder Representative will be entitled to designate a representative (the "Representative Accountant") to observe and comment on the preparation of the Closing Date Balance Sheet and the Adjustment Statement and procedures relating thereto and shall have the right to review the work papers prepared in connection therewith. On or prior to the 20th day after the Stockholder Representative's receipt of the Closing Date Balance Sheet and the Adjustment Statement, the Stockholder Representative may give the Buyer a written notice stating in reasonable detail the Stockholder Representative's objections (an "Objection Notice") to the Closing Date Balance Sheet and/or the Adjustment Statement. If the Stockholder Representative does not tender to the Buyer an Objection Notice within Arbitrator for such 20-day period, then the Closing Date Balance Sheet and the Adjustment Statement will be conclusive and binding upon the Parties and the Working Capital as of the Closing Date determined therefrom will likewise be binding on the Parties for purposes of Section 2.4(d) belowservices.

Preparation of Closing Balance Sheet. On or before Promptly following the 60th day after Closing, the Closing Date, personnel of the Buyer and an Company's internal accounting firm engaged by the Buyer (the "Buyer's Accountant") will staff shall prepare and deliver to the Stockholder Representative an audited a balance sheet of the Company as of the close of business on the Closing Date (the "Closing Date Balance Sheet")) which, together with an unqualified report for purposes of this Agreement, shall reflect the Net Book Value of FHLP's interest in the Valley Assets as if such interest were wholly-owned by the Company. The Valley Auditors shall, at the expense of the Buyer's Accountant thereonSellers, review the Closing Balance Sheet as so prepared and issue their report thereon as provided below. For such purposes, the Buyer shall provide the Valley Auditors with such access to, and a certificate of copies of, such financial information and reports concerning the chief financial officer of Valley Assets and Valley Liabilities as the Buyer setting forth the Buyer's determination of the EXECUTION COPY Working Capital Valley Auditors deem necessary or appropriate so as of to enable them to so review the Closing Date (the "Adjustment Statement")Balance Sheet. The Closing Date Balance Sheet shall be prepared from in accordance with GAAP and reviewed subject to standards otherwise consistent with the Company's books "review" provisions of Statement No. 1, entitled "Compilation and records Review of Financial Statements" (December 1978) of the Accounting and Review Services Committee of the American Institute of Certified Public Accountants. For purposes of the foregoing, the Closing Balance Sheet shall specifically identify any Excluded Obligations otherwise discharged on the Closing Date. The Valley Auditors shall provide the Parties with the Closing Balance Sheet, together with its report thereon to the effect that there are no material modifications that should be made to the Closing Balance Sheet in order for them to be in conformity with GAAP, as soon as practicable but in any event not later than 45 days after the Closing Date. In addition to such report, the Valley Auditors shall, at the time of delivery of the report on the Closing Balance Sheet, also provide the Buyer and Sellers with a separate schedule setting forth the calculation of the Closing Equity Value. The Closing Equity Value shall be calculated in accordance with the accounting principles agreed-upon procedures set forth on EXHIBIT N attached hereto, which the Parties agree shall be followed in subsection (e) below taking into account the payments to be made by the Company in connection with the Closing (including the fees and expenses and Taxes described in Section 11.8)making such calculation. During the preparation Upon calculation of the Closing Date Balance Sheet and all activities in connection therewithEquity Value, the Stockholder Representative will be entitled Sellers shall promptly deliver a written notice to designate a representative Buyer setting forth, as applicable, the calculation of the Underpayment Amount or Overpayment Amount, if any (the "Representative Accountant") to observe and comment on the preparation of the Closing Date Balance Sheet and the Adjustment Statement and procedures relating thereto and shall have the right to review the work papers prepared in connection therewith. On or prior to the 20th day after the Stockholder Representative's receipt of the Closing Date Balance Sheet and the Adjustment Statement, the Stockholder Representative may give the Buyer a written notice stating in reasonable detail the Stockholder Representative's objections (an "Objection Notice") to the Closing Date Balance Sheet and/or the Adjustment Statement. If the Stockholder Representative does not tender to the Buyer an Objection Notice within such 20-day period, then the Closing Date Balance Sheet and the Adjustment Statement will be conclusive and binding upon the Parties and the Working Capital as of the Closing Date determined therefrom will likewise be binding on the Parties for purposes of Section 2.4(d) below).

Preparation of Closing Balance Sheet. On or before the 60th day Within 120 days after the Closing DateEffective Time, personnel Parent shall cause to be prepared and delivered to the Shareholder Representative (as defined in Section 7.3) an unaudited preliminary closing balance sheet of the Buyer and an accounting firm engaged by Company as of the Buyer close of business on the Closing Date (the "Buyer's AccountantPreliminary Closing Balance Sheet"), which Preliminary Closing Balance Sheet shall be non-binding upon the parties and shall be for illustrative purposes only. Within fourteen (14) will prepare months after the Effective Time, Parent shall cause to be prepared and deliver delivered to the Stockholder Shareholder Representative an audited unaudited balance sheet of the Company as of the close of business on the Closing Date (the "Closing Date Balance Sheet"), together with an unqualified report ) and a calculation of the Buyer's Accountant thereon, and a certificate of the chief financial officer of the Buyer setting forth the Buyer's determination of the EXECUTION COPY Working Capital Net Worth Amount as of the Closing Date such date (the "Adjustment StatementClosing Net Worth Amount")) derived from the Closing Balance Sheet. The Closing Date Balance Sheet shall be prepared from the Company's books and records in accordance with the accounting principles books and records of the Company and shall comply with GAAP applied on a consistent basis. If the Closing Net Worth Amount set forth in subsection the Closing Balance Sheet differs from the Estimated Net Worth Amount by $20,000 or less, then the following provisions of this Section 2.2 (eother than Section 2.2(v)) below taking into account shall not apply and Parent and the payments Shareholder Representative (on behalf of the Shareholders) shall mutually agree upon the Final Closing Net Worth Amount, which determination shall be final and binding on the parties hereto, absent fraud or manifest error; provided, however, if Parent and the Shareholder Representative are unable to mutually agree upon the Final Closing Net Worth Amount, the Final Closing Net Worth Amount shall be the average of the Closing Net Worth Amount set forth in the Closing Balance Sheet and the Estimated Net Worth Amount. (i) The Shareholder Representative, on behalf of the Shareholders, shall have a period of thirty (30) days after delivery of the Closing Balance Sheet to present in writing to Parent any objections the Shareholder Representative may have to any of the matters set forth therein which relate to the calculation of the Closing Net Worth Amount, which objections shall be set forth in reasonable detail. If no objections are raised within such 30-day period, the Closing Balance Sheet and the calculation of the Closing Net Worth Amount shall be final and binding on the parties hereto, absent fraud or manifest error. During such 30-day period, Parent shall cause the Shareholder Representative and his authorized representatives to be provided during normal business hours with reasonable access to the facilities, employees, books and records of the Surviving Corporation which are relevant to the Closing Balance Sheet, and Parent shall cooperate fully with the Shareholder Representative and his representatives. (ii) If the Shareholder Representative shall raise any objections within the aforesaid 30-day period, the Shareholder Representative and Parent, together with their respective independent certified public accountants, shall attempt promptly to resolve the matter or matters in dispute and, if resolved, such accounting firms shall send a joint notice to the Shareholder Representative and Parent stating the manner in which the dispute was resolved, and a confirmation of the original Closing Net Worth Amount or a revised Closing Net Worth Amount (the "Final Closing Net Worth Amount") based upon such resolution, whereupon the Final Closing Net Worth Amount shall be final and binding on the parties hereto, absent fraud or manifest error. (iii) If such dispute cannot be resolved by the Shareholder Representative and Parent nor by the aforesaid accounting firms within sixty (60) days after the delivery of the Closing Balance Sheet, then the specific matters in dispute shall be submitted to a firm of independent certified public accountants mutually acceptable to the Shareholder Representative and Parent (the "Final Arbiter"), which firm shall make a final and binding determination as to such matter or matters within forty-five (45) days of its appointment. The Final Arbiter shall send its written determination to the Shareholder Representative and Parent, together with a confirmation of the Final Closing Net Worth Amount based upon such determination, whereupon the Final Closing Net Worth Amount shall be binding on the parties thereto, absent fraud or manifest error. (iv) The parties hereto agree to cooperate with each other and each other's authorized representatives and with the Final Arbiter in order that any and all matters in dispute shall be resolved as soon as practicable and that determination of the Final Closing Net Worth Amount shall be made. (v) After the Effective Time, any adjustment that must be made to the Merger Consideration as a result of (A) the Estimated Net Worth Amount being greater than the Final Closing Net Worth Amount shall be made out of shares of Class B Common Stock on deposit in the Escrow Account (as defined in Section 3.1(e)), subject to the procedures thereof and (B) the Estimated Net Worth Amount being less than the Final Closing Net Worth Amount, shall be made by the Company deposit of an amount in connection cash equal to the difference between such amounts by Parent or the Purchaser with the Closing Exchange Agent (including the fees and expenses and Taxes described in Section 11.8). During the preparation of the Closing Date Balance Sheet and all activities in connection therewith, the Stockholder Representative will be entitled to designate a representative (the "Representative Accountant") to observe and comment on the preparation of the Closing Date Balance Sheet and the Adjustment Statement and procedures relating thereto and shall have the right to review the work papers prepared in connection therewith. On or prior to the 20th day after the Stockholder Representative's receipt of the Closing Date Balance Sheet and the Adjustment Statement, the Stockholder Representative may give the Buyer a written notice stating in reasonable detail the Stockholder Representative's objections (an "Objection Notice") to the Closing Date Balance Sheet and/or the Adjustment Statement. If the Stockholder Representative does not tender to the Buyer an Objection Notice within such 20-day period, then the Closing Date Balance Sheet and the Adjustment Statement will be conclusive and binding upon the Parties and the Working Capital as of the Closing Date determined therefrom will likewise be binding on the Parties for purposes of Section 2.4(d) below.defined in

Preparation of Closing Balance Sheet. On or before the 60th day after the Closing Date, personnel of the Buyer and an accounting firm engaged by the Buyer (the "Buyer's Accountant") will prepare and deliver to the Stockholder Representative an audited balance sheet of the Company as of the close of business on the Closing Date (the "Closing Date Balance Sheet"), together with an unqualified report of the Buyer's Accountant thereon, and a certificate of the chief financial officer of the Buyer setting forth the Buyer's determination of the EXECUTION COPY Working Capital as A draft of the Closing Date (the "Adjustment Statement"). The Closing Date Balance Sheet shall be prepared from delivered by Vividence to Keynote not later than two (2) business days prior to the Company's books and records in accordance with Closing Date. Vividence shall provide to Keynote, promptly after Keynote’s request, copies of the accounting principles documents, instruments or other information evidencing the amounts set forth on any such draft or final Closing Balance Sheet (and after the Effective Time, the Shareholders’ Representative shall be entitled to access such information). In the event that Keynote objects to the calculation of the Total Vividence Assets or the Total Vividence Liabilities as set forth on the Closing Balance Sheet, Keynote shall deliver to the Shareholders’ Representative within sixty (60) days after the delivery of such Closing Balance Sheet a statement (the “Statement of Objections”) describing in subsection reasonable detail any objections to the Closing Balance Sheet. If Keynote has vacated the Vividence leased premises in San Mateo prior to (ei) below taking into account October 1, 2004, the payments Total Vividence Liabilities shall be increased by $33,980.40, or (ii) after October 1, 2004 but prior to November 1, 2004, the Total Vividence Liabilities shall be made increased by $16,999.20. Keynote and the Company Shareholders’ Representative shall use all reasonable efforts to resolve any such objections, but if they do not reach a final resolution within thirty (30) days of the delivery of the Statement of Objections, Keynote and the Shareholders’ Representative shall submit the Closing Balance Sheet and the Statement of Objections to a San Jose, California office of an independent accounting firm of national standing that does not provide audit or accounting services to Keynote or Vividence (the “Independent Accountant”) to resolve any remaining objections within thirty (30) days of the date of such submission. The determination (the “Determination”) of the Independent Accountant or such other determination pursuant to this Section 2.5 (whether by lack of objection or mutual agreement) shall be conclusive and binding on all parties and neither Keynote nor the Shareholders’ Representative shall thereafter be entitled to challenge such determination of the Closing Balance Sheet or to otherwise seek any other adjustment to the Total Combined Closing Payments or to claim any damages in connection with the Closing Balance Sheet or the determination of Vividence Total Liabilities or Vividence Total Assets, other than payment of the Adjustment Amount (including the as defined below) as provided in this Section 2.5 and Section 8.2(a)(iii) hereto, except in cases of fraudulent conduct or fraudulent misrepresentation. The fees and expenses and Taxes described incurred in Section 11.8). During connection with the preparation engagement of the Independent Accountant shall be borne by Keynote or the holders of Vividence Preferred Stock, as the case may be, whose version of the Closing Date Balance Sheet was further from the Closing Balance Sheet determined by the Independent Accountant. In the event that the resolution regarding the Statement of Objections and all activities the Closing Balance Sheet, whether by mutual agreement or by determination of the Independent Accountant, would have resulted in connection therewithan adjustment to the Total Combined Closing Payments had such matters been incorporated into the Closing Balance Sheet delivered at the Closing, the Stockholder Representative will then Keynote shall be entitled to designate a representative receive from the Escrowed Funds an amount equal to the amount by which the Total Combined Closing Payments would have been so reduced (the "Representative Accountant") to observe and comment on “Adjustment Amount”), provided, however, that the preparation Earnout Limit shall be increased by the Amount of the Closing Date Balance Sheet and the Adjustment Statement and procedures relating thereto and shall have the right to review the work papers prepared in connection therewith. On or Amount prior to the 20th day after Escrow Release Date. To the Stockholder Representative's receipt of extent liabilities are reflected on the Closing Date Balance Sheet Sheet, Keynote or the Surviving Corporation hereby covenants and agrees to pay promptly when due the Adjustment Statement, the Stockholder Representative may give the Buyer a written notice stating in reasonable detail the Stockholder Representative's objections (an "Objection Notice") to full amount of such liabilities reflected on the Closing Date Balance Sheet and/or the Adjustment Statement. If the Stockholder Representative does not tender to the Buyer an Objection Notice within such 20-day period, then the Closing Date Balance Sheet and the Adjustment Statement will be conclusive and binding upon the Parties and the Working Capital as of the Closing Date determined therefrom will likewise be binding on the Parties for purposes of Section 2.4(d) belowSheet.

Preparation of Closing Balance Sheet. On or before the 60th day As promptly as practicable, but not later than sixty (60) calendar days after the Closing Date, personnel of the Buyer and an accounting firm engaged by the Buyer Date (the "Buyer's Accountant") will “Preparation Period”), Parent shall prepare in good faith, or cause to be prepared in good faith, and shall deliver to the Stockholder Representative an audited Representatives a consolidated balance sheet of the Company and its Subsidiaries as of the close of business on the Closing Date (the "Closing Date Balance Sheet"), together with an unqualified report of the Buyer's Accountant thereon, and a certificate of the chief financial officer of the Buyer setting forth the Buyer's determination of the EXECUTION COPY Working Capital as of Business Day immediately preceding the Closing Date (the "“Closing Balance Sheet”), and a statement which shall set forth the Net Working Capital Amount (the “Net Working Capital Adjustment Statement"). The Closing Date Balance Sheet ”) and the resulting Net Working Capital Adjustment which shall be prepared from the Company's books and records in accordance with GAAP, using, to the accounting principles set forth in subsection extent consistent with GAAP, the Applicable Principles. The Stockholder Representatives and their accountants and representatives may meet with or make inquiries of Parent and its accountants and representatives at any time (e) below taking into account the payments whether prior to, during or subsequent to be made by the Company in connection with the Closing (including the fees and expenses and Taxes described in Section 11.8). During the preparation of the Closing Date Balance Sheet and all activities Net Working Capital Adjustment Statement) regarding questions concerning, or disagreements with, the Closing Balance Sheet and the other statement arising in connection therewiththe course of their review thereof, and Parent shall use its, and shall cause the Company and its Subsidiaries to use their respective, commercially reasonable efforts to cause any such accountants to cooperate with and respond to such inquiries. Immediately after receipt of the Closing Balance Sheet or the other statement, the Stockholder Representative will Representatives shall be entitled given reasonable access to designate a representative (and reasonable numbers of copies of), the "Representative Accountant") to observe books and comment on records of the Company and its Subsidiaries and all of Parent’s and its representatives’ work papers, worksheets, notes and schedules used in the preparation of the Closing Date Balance Sheet during reasonable business hours for the purpose of reviewing the Closing Balance Sheet and the Net Working Capital Adjustment Statement and procedures relating thereto and shall have the right to review the work papers prepared in connection therewithStatement. On or prior to the 20th day after Unless Parent provides the Stockholder Representative's receipt of Representatives the Closing Date Balance Sheet and the Net Working Capital Adjustment StatementStatement in writing within such Preparation Period, the Stockholder Representative may give the Buyer a written notice stating in reasonable detail the Stockholder Representative's objections (an "Objection Notice") to the Estimated Closing Date Balance Sheet and/or the Adjustment Statement. If the Stockholder Representative does not tender to the Buyer an Objection Notice within such 20-day period, then the Closing Date Balance Sheet and the Estimated Net Working Capital Adjustment Statement will be conclusive and binding upon delivered to Parent by the Parties Company prior to Closing and the resulting Estimated Net Working Capital as of the Closing Date determined therefrom will likewise Adjustment, if any, shall be binding on the Parties Parties, and shall be the final Closing Balance Sheet and the final Net Working Capital Adjustment for purposes of Section 2.4(d) belowthis Agreement.

Preparation of Closing Balance Sheet. On or before After Closing, Seller shall have reasonable access to the 60th day after the Closing Date, personnel books and records of the Business and all relevant personnel responsible for such books and records for the purpose of closing the books for the Business at December 31, 2005. After Closing, Buyer shall prepare consolidating and an accounting firm engaged by the Buyer (the "Buyer's Accountant") will prepare and deliver to the Stockholder Representative an audited balance sheet consolidated statements of the Company Assets and the Assumed Liabilities as of the close of business on the Closing Date (collectively, the "“Closing Date Balance Sheet"), together with an unqualified report of the Buyer's Accountant thereon, and a certificate of the chief financial officer of the Buyer setting forth the Buyer's determination of the EXECUTION COPY Working Capital as of the Closing Date (the "Adjustment Statement"”). The Closing Date Balance Sheet shall be prepared from in accordance with GAAP applied on a basis consistent with the Company's Interim Balance Sheet, except that: (i) only the Assets and the Assumed Liabilities shall be included, and no Retained Assets or Retained Liabilities shall be included; (ii) no item shall be excluded due to a lack of materiality, (iii) inventory shall be stated on a basis consistent with past practice, but in no event shall the aggregate value for inventory exceed the aggregate fair market value for inventory; (iv) $290,000 of the HIA Claim shall be recorded as an asset, and no other assets or liabilities related to the HIA Claim, shall be included; (v) percentage of completion liability (cost in excess of ▇▇▇▇▇▇▇▇ less ▇▇▇▇▇▇▇▇ in excess of costs, such net amount herein “POC Liability”) shall be recorded as a current liability; (vi) other year-end or period end accruals in accordance with GAAP shall be recorded; (vii) all accruals in respect of liabilities existing at the Closing Date to be paid after Closing by Buyer shall be recorded (including the estimate of $25,000 in legal fees with respect to the HIA Claim); and (viii) all accruals in respect of liabilities existing at the Closing Date to be paid before, at or after Closing by Seller shall be excluded (including the accruals with respect to bad debt, warranty claims, paid time off, etc.). If the Interim Balance Sheet is not presented in accordance with GAAP and the foregoing exceptions in all respects, the Closing Balance Sheet shall nevertheless properly reflect GAAP and the foregoing exceptions in all respects so that the Purchase Price Adjustment shall take into account the effect of any non-GAAP treatment and the absence of the above exceptions in the Interim Balance Sheet. Buyer may conduct a physical count of the inventory of Seller within 15 days of Closing. Buyer shall give Comfort Systems and its accountants at least two Business Days’ prior written notice of such inventory count, and Comfort Systems and its accountants may observe such inventory count. Such inventory count shall be used to prepare the Closing Balance Sheet. Within 10 days of Closing, Seller will make available to Buyer all books and records of Seller as of December 31, 2005 necessary to assist Buyer in accordance with the accounting principles set forth in subsection (e) below taking into account the payments to be made by the Company in connection with the Closing (including the fees and expenses and Taxes described in Section 11.8). During the preparation of the Closing Date Balance Sheet and all activities in connection therewith, the Stockholder Representative will be entitled to designate a representative (the "Representative Accountant") to observe and comment on the preparation of the Closing Date Balance Sheet and the Adjustment Statement and procedures relating thereto and shall have the right to review the work papers prepared in connection therewith. On or prior to the 20th day after the Stockholder Representative's receipt of the Closing Date Balance Sheet and the Adjustment Statement, the Stockholder Representative may give the Buyer a written notice stating in reasonable detail the Stockholder Representative's objections (an "Objection Notice") to the Closing Date Balance Sheet and/or the Adjustment Statement. If the Stockholder Representative does not tender to the Buyer an Objection Notice within such 20-day period, then the Closing Date Balance Sheet and the Adjustment Statement will be conclusive and binding upon the Parties and the Working Capital as of the Closing Date determined therefrom will likewise be binding on the Parties for purposes of Section 2.4(d) belowSheet.