Assumed Work in Process Contracts. (a) Section 3.17(a) of the Disclosure Schedules sets forth a true and complete list of each contract pursuant to which, as of the Closing Date, any of Full Moon is providing to customers products or services related to the Business pursuant to statements of work or work orders that are still in effect and not yet substantially completed (each, a “Work in Process Contract”), together with, in each case, as of three (3) business days prior to Closing, and as calculated in accordance with each respective company’s historical practices, (i) the actual amounts collected by such company in respect of each Work in Process Contract, (ii) Full Moon’s good faith estimate of the projected revenues from the work currently in process under each Work in Process Contract, and (iii) Full Moon’s good faith estimate of the projected revenues from the work anticipated under each Work in Process Contract that is not yet in process. Notwithstanding anything herein to the contrary, the parties acknowledge and agree that the amounts set forth on Section 3.17(a) of the Disclosure Schedules are estimates only and the representations in this Section 3.17 will be deemed to be “inaccurate” or “breached” only if and to the extent the estimates set forth in this Section are determined to not have been made in good faith.
(b) Except as set forth on Section 3.17(b) of the Disclosure Schedules, except as set forth in the allowance for doubtful accounts in the Financial Statements, and except to the extent paid prior to Closing, all of the accounts receivable of Full Moon as of three (3) business days prior to Closing (i) represent valid obligations of customers of Full Moon arising from bona fide transactions entered into in the ordinary course of business and (ii) are not the subject of any pending or unresolved customer dispute.
Assumed Work in Process Contracts. (a) Section 3.17(a) of the Disclosure Schedules sets forth a true and complete list of each contract pursuant to which, as of September 30, 2021, Company is providing to customers products or services related to the Business pursuant to statements of work or work orders that are still in effect and not yet substantially completed (each, a “Work in Process Contract”), together with, in each case, as of the date of the Interim Financial Statements, and as calculated in accordance with Company’s historical practices, (i) the estimated cost to be incurred by Company over the life of each Work in Process Contract (the “Estimated Cost”), which represents Sellers’ good faith estimate of the expected costs incurred, (ii) the actual amounts paid by Company in respect to each Work in Process Contract (the “Actual Cost”), (iii) the estimated revenue expected to be received by Company over the life of each Work in Process Contract (the “Total Contract Value”), which represents Sellers’ good faith estimate of the expected revenue, (iv) the actual amounts collected by Company in respect of each Work in Process Contract, (v) Company’s good faith estimate of the percentage completion of each Work in Process Contract, which is determined by the quotient of the Actual Cost of each such Work in Process Contract divided by the Estimated Cost of each such Work in Process Contract and (vi) the estimated gross profit, which represents the difference between the Total Contract Value and the Estimated Cost. Notwithstanding anything herein to the contrary, the parties acknowledge and agree that the amounts set forth on Section 3.17(a) of the Disclosure Schedules are estimates only and the representations in this Section 3.17 will be deemed to be “inaccurate” or “breached” only if and to the extent the estimates set forth in this Section are determined to not have been made in good faith.
(b) Except as set forth on Section 3.17(b) of the Disclosure Schedules, except as set forth in the allowance for doubtful accounts in the Financial Statements, and except to the extent paid prior to Closing, all of the accounts receivable of Company as of the date of the Interim Financial Statements (i) represent valid obligations of customers of Company arising from bona fide transactions entered into in the ordinary course of business and (ii) to Sellers’ knowledge, are collectible in accordance with the terms of such obligations.
