Inventory Purchase Price Adjustment. Within 30 days after the Closing Date, Seller shall deliver to Purchaser a schedule (the “Closing Inventory Schedule”) setting forth the value of the Inventory used or useable by the Business as of the close of business on the last business day preceding the Closing Date (the “Closing Inventory”). The valuation of the Closing Inventory reflected on the Closing Inventory Schedule shall be determined on all Inventory produced or acquired by Seller in the Ordinary Course of Business as follows: (i) with respect to finished goods, the value of each class of OTR Tire as determined in a manner consistent with Seller’s accounting practices as set forth on below shall be used to determine the aggregate value of such finished goods, (ii) with respect to raw materials, the per pound value of each component thereof is set forth on Schedule 2.4 and the raw materials shall be valued in a manner consistent with Seller’s accounting practices and (iii) with respect to work in process, such value shall be determined in accordance with Seller’s established accounting practices. All Closing Inventory will be valued consistent with Seller’s accounting practices which include assessing inventory for reserves at the lower of cost or net realizable value and reserves for obsolete inventory in accordance with Seller’s applicable accounting principles (which accounting principles comply with GAAP except in respect to the capitalized costs related to pension and retiree, medical and depreciation, all of which are accounted for using principles in accordance with IFRS.) (a) The Closing Inventory as reflected in the Closing Inventory Schedule (the “Closing Inventory Value”), shall become final and binding upon the written agreement of the parties. In the event of any disagreement, Seller and Purchaser shall negotiate in good faith to resolve any differences. If within ten (10) days following receipt of the Closing Inventory Schedule by Purchaser, any such differences have not been resolved, they shall be resolved by KPMG or such other independent accounting firm of national reputation as may be mutually acceptable to Seller and Purchaser (the “Independent Accountants”). The Independent Accountants will be instructed to conduct such dispute resolution and perform their services as expeditiously as possible, and to deliver a revised Closing Inventory Value to Seller and Purchaser as a result thereof, which revised Closing Inventory Value shall be binding on the parties. The revised Closing Inventory Value shall be prepared by the Independent Accountants in compliance with Seller’s current accounting and inventory costing practices currently in place and established in Seller’s accounting manual. The fees and expenses of Independent Accountants in preparing the revised Closing Inventory Value and in taking the physical inventory shall be borne equally by Seller and Purchaser. (b) The final and binding Closing Inventory Value determined pursuant to Section 2.4(a), whether by (i) Seller’s and Purchaser’s mutual agreement in writing, or (ii) delivery thereof by the Independent Accountants, is hereinafter referred to as the “Final Closing Inventory Value.” (c) If the Final Closing Inventory Value is less than $11,500,000, then (A) the Initial Purchase Price shall be reduced, dollar for dollar, by the amount of such shortfall (with the amount of the Initial Purchase Price as so reduced referred to herein as the “Final Purchase Price”), and (B) Seller shall pay to Purchaser an amount equal to (x) the Initial Purchase Price less (y) the Final Purchase Price. (d) If the Final Closing Inventory Value is greater than $11,500,000, then (A) the Initial Purchase Price shall be increased, dollar for dollar, by the amount of such excess (with the amount of the Initial Purchase Price as so increased also referred to herein as the “Final Purchase Price”) and (B) Purchaser shall pay to Seller an amount equal to (x) the Final Purchase Price less (y) the Initial Purchase Price. (e) Any payment due by Seller to Purchaser or by Purchaser to Seller pursuant to this Section 2.4 shall be paid no later than three business days after the determination of the Final Closing Inventory Value, by wire transfer of immediately available funds to such account as shall be designated by the recipient. (f) Payments owing by one party to the other under this Section 2.4 shall bear interest at the Agreed Rate from the date of determination of the Final Closing Inventory Value until the date payment-in-full is made.
Appears in 2 contracts
Samples: Asset Purchase Agreement (Titan International Inc), Asset Purchase Agreement (Titan International Inc)
Inventory Purchase Price Adjustment. (a) Within 30 45 days after following the Closing Date, Seller shall deliver to Purchaser Buyer a schedule statement (the “Closing Inventory ScheduleSeller’s Calculation”) setting forth the value of the Inventory used or useable by the Business Inventory, as of the close of business on the last business day preceding the Closing Date (the “Closing InventoryInventory Value”)) determined in conformity with GAAP on a standard cost basis, using ending fiscal year 2009 standard costs of Seller, and in conformity with the valuation standard set forth in Section 3.13. The valuation Notwithstanding the foregoing, (i) the certain TCAM4 parts that are affected by the “read-after-lookup” issue, specifically the TCAM4 parts with the part number 75H652BSxxxAT, will not be included in the Closing Inventory Value; (ii) the certain modified TCAM4 part that is not affected by the “read-after-lookup” issue, specifically part number 75H652CSxxxAT, shall be included in the Closing Inventory Value in an amount not to exceed $600,000; and (iii) the certain TCAM3CR part, part number 75H7B0A1SxxxRN, shall be included in the Closing Inventory Value in an amount not to exceed $600,000.
(b) If Buyer disagrees with the Seller’s Calculation, Buyer may, within 15 days after delivery of the Seller’s Calculation, deliver a notice (the “Buyer’s Objection”) to Seller disagreeing with the Seller’s Calculation and specifying, in reasonable detail (i) Buyer’s calculation of the Closing Inventory reflected Value and (ii) Buyer’s grounds for such disagreement.
(c) If a Buyer’s Objection is duly delivered pursuant to Section 2.8(b), Buyer and Seller shall, during the 15 days following such delivery, use their reasonable efforts to reach agreement on the Closing Inventory Schedule shall be determined on all Inventory produced or acquired by Seller in the Ordinary Course of Business as follows: (i) with respect Value. If they are unable to finished goodsreach such agreement during such period, the value parties shall promptly engage the CPA Firm to review promptly the Inventory for the purpose of each class of OTR Tire as determined in a manner consistent with Seller’s accounting practices as set forth on below shall be used to determine the aggregate value of such finished goods, (ii) with respect to raw materials, the per pound value of each component thereof is set forth on Schedule 2.4 and the raw materials shall be valued in a manner consistent with Seller’s accounting practices and (iii) with respect to work in process, such value shall be determined in accordance with Seller’s established accounting practices. All Closing Inventory will be valued consistent with Seller’s accounting practices which include assessing inventory for reserves at the lower of cost or net realizable value and reserves for obsolete inventory in accordance with Seller’s applicable accounting principles (which accounting principles comply with GAAP except in respect to the capitalized costs related to pension and retiree, medical and depreciation, all of which are accounted for using principles in accordance with IFRS.)
(a) The Closing Inventory as reflected in calculating the Closing Inventory Schedule (Value. In making such calculation, the “CPA Firm shall determine the Closing Inventory Value”). The CPA Firm shall deliver to Buyer and Seller, as promptly as practicable, a report setting forth such calculation of the Closing Inventory Valuation. Such report shall become be final and binding upon the written agreement of the parties. In the event of any disagreement, Buyer and Seller and Purchaser shall negotiate in good faith to resolve any differences. If within ten (10) days following receipt of the Closing Inventory Schedule by Purchaser, any such differences have not been resolved, they shall be resolved by KPMG or such other independent accounting firm of national reputation as may be mutually acceptable to Seller and Purchaser (the “Independent Accountants”absent manifest error). The Independent Accountants will be instructed to conduct such dispute resolution and perform their services as expeditiously as possible, and to deliver a revised Closing Inventory Value to Seller and Purchaser as a result thereof, which revised Closing Inventory Value shall be binding on cost of the parties. The revised Closing Inventory Value shall be prepared by the Independent Accountants in compliance with Seller’s current accounting and inventory costing practices currently in place and established in Seller’s accounting manual. The fees and expenses of Independent Accountants in preparing the revised Closing Inventory Value and in taking the physical inventory CPA Firm shall be borne equally by Seller Buyer and PurchaserSeller.
(bd) The final Buyer and binding Seller each agree to reasonably cooperate and assist in the determination of the Closing Inventory Value determined pursuant under this Section 2.8, including by making available to Section 2.4(a)the other party and its representatives, whether by (i) Sellerto the extent reasonably requested, reasonable access to books, records, work papers, personnel and representatives in connection with such other party’s preparation and Purchaser’s mutual agreement in writing, or (ii) delivery thereof by review of the Independent Accountants, is hereinafter referred to as the “Final Closing Inventory Valueclosing statement.”
(ce) If the Final Closing Inventory Value (as defined below) is less than the Base Inventory Value, the parties shall reduce, as an adjustment to the Purchase Price, the principal amount of the Promissory Note by the amount by which the Final Inventory Value is less than $11,500,000the Base Inventory Value, then (A) the Initial Purchase Price shall such reduction to be reduced, dollar for dollar, by the amount of such shortfall (with the amount effective as of the Initial Purchase Price as so reduced referred to herein as date of the “determination of the Final Purchase Price”)Inventory Value, and (B) Seller shall pay to Purchaser an amount equal to (x) in accordance with Section 2.4 of the Initial Purchase Price less (y) the Final Purchase Price.
(d) Promissory Note. If the Final Closing Inventory Value is greater than the Base Inventory Value, Buyer shall pay to Seller, as an adjustment to the Purchase Price, the amount by which the Final Inventory Value is greater than the Base Inventory Value; provided, however, that if the amount by which the Final Inventory Value exceeds the Base Inventory Value is greater than Two Million Dollars ($11,500,0002,000,000), then Inventory with a value exceeding such $2,000,000 shall be purchased by Buyer from Seller in Buyer’s ordinary course of business and the value of such Inventory amount that exceeds such $2,000,000 shall not otherwise be payable by Buyer pursuant to Section 2.8(f). “Final Inventory Value” means the Closing Inventory Value (i) as shown in the Seller’s Calculation if no Buyer’s Objection is duly delivered to Seller in compliance with Section 2.8(b); or (ii) if such a notice of disagreement is delivered, (A) the Initial Purchase Price shall be increased, dollar for dollar, as agreed by the amount of such excess (with the amount of the Initial Purchase Price as so increased also referred Buyer and Seller pursuant to herein as the “Final Purchase Price”Section 2.8(c) and or (B) Purchaser shall pay to Seller an amount equal to (x) in the Final Purchase Price less (y) absence of such agreement, as shown in the Initial Purchase Price.
(e) Any payment due by Seller to Purchaser or by Purchaser to Seller CPA Firm’s calculation delivered pursuant to this Section 2.4 shall be paid no later than three business days after the determination of the Final Closing Inventory Value, by wire transfer of immediately available funds to such account as shall be designated by the recipient2.8(c).
(f) Payments owing by one party to the other under this Section 2.4 shall bear interest at the Agreed Rate from the date of determination of the Final Closing Inventory Value until the date payment-in-full is made.
Appears in 2 contracts
Samples: Asset Purchase Agreement (Netlogic Microsystems Inc), Asset Purchase Agreement (Integrated Device Technology Inc)
Inventory Purchase Price Adjustment. (a) On or as promptly as practicable after the Closing Date, Purchaser shall take, using either Transferred Employees or a third-party entity reasonably acceptable to Sellers, a physical count of the Inventory (and a simultaneous physical identification of the Finished Goods). Representatives of Sellers shall be given an opportunity in all reasonable respects and in good faith to (i) observe, along with their accountants, such taking of the Inventory (and such physical identification of the Finished Goods) and (ii) to conduct test counts of the Inventory (and such physical identification of the Finished Goods) and in connection with such test counts Purchaser agrees not to release an area from the process until such opportunity to take test counts has been provided to Sellers. Following preparation of an inventory report, Sellers shall be given an opportunity in all reasonable respects to review the inventory report and work papers.
(b) Within 30 forty-five (45) days after the Closing Date, Seller Purchaser shall deliver prepare and deliver, or cause to Purchaser be prepared and delivered, to Sellers a schedule statement as of the Closing Date (collectively, the “Closing "Initial Inventory Schedule”Statement", and in its final and binding form as determined pursuant to this Section 3.3(b), the "Final Inventory Statement") setting forth the aggregate value of the Inventory used or useable by the Business as of the close of business on the last business day preceding the Closing Date (the “Closing "Applicable Inventory”"). The valuation of Unless otherwise agreed upon, the Closing Initial Inventory reflected on Statement and the Closing Final Inventory Schedule Statement shall be determined on all Inventory produced or acquired by Seller prepared in the Ordinary Course of Business as follows: (i) accordance with GAAP, except with respect to finished goods, the value of each class of OTR Tire as determined in a manner consistent with Seller’s accounting practices valuations to be applied to the Supplied Production Components and WIP as set forth on below shall be used to determine in the aggregate value respective definitions of such finished goods, (ii) with respect to raw materials, the per pound value of each component thereof is set forth on Schedule 2.4 and the raw materials shall be valued in a manner consistent with Seller’s accounting practices and (iii) with respect to work in process, such value shall be determined in accordance with Seller’s established accounting practicesterms. All Closing The Initial Inventory will be valued consistent with Seller’s accounting practices which include assessing inventory for reserves at the lower of cost or net realizable value and reserves for obsolete inventory in accordance with Seller’s applicable accounting principles (which accounting principles comply with GAAP except in respect to the capitalized costs related to pension and retiree, medical and depreciation, all of which are accounted for using principles in accordance with IFRS.)
(a) The Closing Inventory as reflected in the Closing Inventory Schedule (the “Closing Inventory Value”), Statement shall become final and binding upon the parties on the tenth Business Day following receipt thereof by Sellers unless Sellers give written agreement notice of their disagreement (with such notice so timely delivered referred to herein as a "Notice of Disagreement") to Purchaser prior to such date in accordance with Section 13.7 hereof. Any Notice of Disagreement shall specify in reasonable detail the partiesbasis and amount of any disagreement. In the event of a Notice of Disagreement, then the Initial Inventory Statement (as revised in accordance with clause (x) or (y) below) shall only become final and binding upon the parties on the earlier of (x) the date the parties hereto resolve any disagreementdifferences they have with respect to any matter specified in the Notice of Disagreement or (y) the date any matters in dispute are resolved by an accounting firm jointly selected by Purchaser and Sellers or, Seller if the parties are unable to agree, an independent accounting firm jointly selected by Purchaser's, on the one hand, and Sellers', on the other hand, independent accounting firms (such firm, the "Accounting Firm"). During the thirty (30) days immediately following the delivery of a Notice of Disagreement, Purchaser and Sellers shall negotiate seek in good faith to resolve in writing any differencesdifferences which they may have with respect to any matter specified in the Notice of Disagreement. If within ten (10) days following receipt At the end of the Closing Inventory Schedule by Purchasersuch 30-day period, any such differences have not been resolved, they shall be resolved by KPMG or such other independent accounting firm of national reputation longer period as may be mutually acceptable agreed, either Purchaser, on the one hand, or Sellers, on the other hand, shall submit for review and resolution by the Accounting Firm any and all matters which remain in dispute and are related to Seller and Purchaser (the “Independent Accountants”). The Independent Accountants will be instructed to conduct such dispute resolution and perform their services as expeditiously as possiblematters included in the Notice of Disagreement, and the Accounting Firm shall make a final determination with respect to deliver a revised Closing Inventory Value to Seller and Purchaser as a result thereofthe dispute, which revised Closing Inventory Value determination shall be binding on the parties. The revised Closing Inventory Value In making such determination: (i) the Accounting Firm shall determine only those matters which remain in dispute and which were included in the Notice of Disagreement and (ii) the scope of any dispute shall be prepared by limited as to whether the Independent Accountants calculation in compliance dispute under the Notice of Disagreement was done in accordance with Seller’s current accounting and inventory costing practices currently in place and established in Seller’s accounting manualthis Section 3.3. The Final Inventory Statement shall become final and binding on Purchaser and Sellers on the date the Accounting Firm delivers the Final Inventory Statement to the parties. Each party shall pay its own fees and expenses incurred in connection with any Notice of Disagreement; provided, that the fees and expenses of Independent Accountants in preparing the revised Closing Inventory Value and in taking the physical inventory Accounting Firm pursuant to this Section 3.3 shall be borne equally one-half each by Seller Purchaser, on the one hand, and PurchaserSellers, on the other hand.
(b) The final and binding Closing Inventory Value determined pursuant to Section 2.4(a), whether by (i) Seller’s and Purchaser’s mutual agreement in writing, or (ii) delivery thereof by the Independent Accountants, is hereinafter referred to as the “Final Closing Inventory Value.”
(c) If Within two (2) Business Days after the date the Final Closing Inventory Value is less than $11,500,000, then (A) the Initial Purchase Price shall be reduced, dollar for dollar, by the amount of such shortfall (with the amount of the Initial Purchase Price as so reduced referred Statement becomes final and binding pursuant to herein as the “Final Purchase Price”Section 3.3(b), and (B) Seller shall pay Purchaser will reduce Sellers' accounts payable balance due to Purchaser pursuant to the Manufacturing and Distribution Agreements (and issue a credit to be utilized immediately against any such future accounts payable balance if the existing accounts payable balance is not of sufficient size) in an aggregate amount equal to (x) the value of the Applicable Inventory set forth in the Final Inventory Statement; provided, however, that if Sellers provide a Notice of Disagreement and certain amounts in the Initial Purchase Price less Inventory Statement are undisputed, then Purchaser shall make a partial adjustment for such undisputed amounts within five (y5) Business Days after such Notice of Disagreement and a final adjustment within two (2) Business Days after the Final Purchase Price.
(d) If the Final Closing Inventory Value is greater than $11,500,000, then (A) the Initial Purchase Price shall be increased, dollar for dollar, by the amount of such excess (with the amount of the Initial Purchase Price as so increased also referred to herein as the “Final Purchase Price”) Statement becomes final and (B) Purchaser shall pay to Seller an amount equal to (x) the Final Purchase Price less (y) the Initial Purchase Price.
(e) Any payment due by Seller to Purchaser or by Purchaser to Seller binding pursuant to this Section 2.4 shall be paid no later than three business days after the determination of the Final Closing Inventory Value, by wire transfer of immediately available funds to such account as shall be designated by the recipient3.3(b).
(f) Payments owing by one party to the other under this Section 2.4 shall bear interest at the Agreed Rate from the date of determination of the Final Closing Inventory Value until the date payment-in-full is made.
Appears in 1 contract
Samples: Asset Purchase Agreement (Glenayre Technologies Inc)
Inventory Purchase Price Adjustment. (a) Within 30 thirty (30) calendar days after the Closing Date, Seller shall prepare and deliver to Purchaser an unaudited schedule (the “Estimated Closing Inventory Schedule”), setting forth its calculation of the book value (adjusted by a schedule mxxx to market adjustment for the price of grain at the Closing) of the Inventory as of the Closing Date, which calculation shall be based upon an inventory count and as described in this Section 2.4(a) (the “Closing Inventory Schedule”) setting forth the value of the Inventory used or useable by the Business as of the close of business on the last business day preceding the Closing Date (the “Closing InventoryAmount”). The Estimated Closing Inventory Schedule and the Estimated Closing Inventory Amount shall be prepared as provided herein and in accordance with the accounting principles and procedures used by Seller in preparation of its Financial Statements (the “Inventory Procedures”) and the inventory valuation process (the “Inventory Valuation Process”), both of which are attached hereto as Schedule 2.4(a). On or before the Closing Date, Seller shall schedule an inventory count, and in connection therewith, Purchaser shall assist Seller and its Representatives in the preparation of the Closing Inventory reflected on Schedule and shall provide Seller and its Representatives access to the Closing Inventory Schedule Real Property for same and any information reasonably requested for such purpose. Purchaser and its Representatives shall be determined on all Inventory produced or acquired by Seller in the Ordinary Course of Business as follows: (i) with respect to finished goods, the value of each class of OTR Tire as determined in a manner consistent with Seller’s accounting practices as set forth on below shall be used to determine the aggregate value of present at such finished goods, (ii) with respect to raw materials, the per pound value of each component thereof is set forth on Schedule 2.4 and the raw materials shall be valued in a manner consistent with Seller’s accounting practices and (iii) with respect to work in process, such value shall be determined in accordance with Seller’s established accounting practices. All Closing Inventory will be valued consistent with Seller’s accounting practices which include assessing inventory for reserves at the lower of cost or net realizable value and reserves for obsolete inventory in accordance with Seller’s applicable accounting principles (which accounting principles comply with GAAP except in respect to the capitalized costs related to pension and retiree, medical and depreciation, all of which are accounted for using principles in accordance with IFRScount.)
(ab) The Closing Inventory as reflected in the Closing Inventory Schedule Unless Purchaser notifies Seller by written notice within thirty (the “Closing Inventory Value”), shall become final and binding upon the written agreement of the parties. In the event of any disagreement, Seller and Purchaser shall negotiate in good faith to resolve any differences. If within ten (1030) calendar days following after receipt of the Closing Inventory Schedule by Purchaserfrom Seller (the “Objection Notice”) that it objects to the calculation of the Estimated Closing Inventory Amount contained therein, any specifying in detail the reasonable basis for such differences have not been resolvedobjection, they Seller’s calculation of the Closing Inventory Amount shall be resolved final and binding upon the parties. The calculation of the Closing Inventory Amount shall not be disputed as to accounting principles or procedures so long as the principles and procedures used to calculate it are consistent with the Inventory Procedures and the Inventory Valuation Process. If Purchaser and Seller are unable to agree upon the calculation of the Closing Inventory Amount within thirty (30) calendar days after the Objection Notice has been given by KPMG or such other independent accounting firm of national reputation as may be mutually acceptable Purchaser to Seller or within a mutually agreed to extended time period, Purchaser and Purchaser Seller shall retain and have the dispute referred to the Txxxxxx, Xxxxxxx Xxxxxx office of Deloitte Touch (the “Independent AccountantsAccountant”)) for a final determination thereof. Seller and Purchaser shall provide the Independent Accountant with any information reasonably requested by it to reach a final determination thereof. The Independent Accountants will be instructed to Accountant shall conduct such dispute resolution and perform their services as expeditiously as possible, possible and to deliver a revised its determination of the Closing Inventory Value to Seller and Purchaser as a result thereof, which revised Closing Inventory Value Amount shall be final and binding on upon the parties. The revised Closing Inventory Value parties shall be prepared by share equally the Independent Accountants in compliance with Seller’s current accounting and inventory costing practices currently in place and established in Seller’s accounting manual. The fees and expenses of Independent Accountants in preparing the revised Closing Inventory Value and in taking the physical inventory shall be borne equally by Seller and Purchasersuch firm.
(bc) The final and binding Closing Inventory Value Amount determined pursuant to this Section 2.4(a)2.4, whether by (i) Purchaser’s failure to file a timely objection to Seller’s determination of the Closing Inventory Amount, (ii) Seller’s and Purchaser’s mutual agreement in writing, or (iiiii) delivery determination thereof by the Independent AccountantsAccountant, is hereinafter referred to as the “Final Closing Inventory ValueAmount.”
(cd) If The Purchase Price shall be either increased dollar for dollar (Canadian) by the amount by which the Final Closing Inventory Value is less than $11,500,000, then (A) Amount exceeds the Initial Purchase Price shall be reduced, Preliminary Closing Inventory Amount or decreased dollar for dollar, dollar (Canadian) by the amount of such shortfall (with by which the amount of the Initial Purchase Price as so reduced referred to herein as the “Final Purchase Price”), and (B) Seller shall pay to Purchaser an amount equal to (x) the Initial Purchase Price less (y) the Final Purchase Price.
(d) If Preliminary Closing Inventory Amount exceeds the Final Closing Inventory Value is greater than $11,500,000, then (A) the Initial Purchase Price shall be increased, dollar for dollar, by the amount of such excess (with the amount of the Initial Purchase Price as so increased also referred to herein as the “Final Purchase Price”) and (B) Purchaser shall pay to Seller an amount equal to (x) the Final Purchase Price less (y) the Initial Purchase Price.
(e) Amount. Any payment due by Seller to Purchaser or by Purchaser to Seller pursuant to this Section 2.4 shall be paid no later than three (3) business days after the determination of the Final Closing Inventory Value, Amount by wire transfer of immediately available funds to such account as shall be designated by the recipient.
(f) Payments owing by one party to the other under this Section 2.4 shall bear interest at the Agreed Rate from the date of determination of the Final Closing Inventory Value until the date payment-in-full is made.
Appears in 1 contract