Common use of Merger Consideration Adjustments Clause in Contracts

Merger Consideration Adjustments. Ernst & Young, LLP shall within seventy-five (75) days of the Closing Date conduct an audit of the Company and the Partnership to ensure that the Company and the Partnership have collected accounts receivable and paid accounts payable in the ordinary course of business during the ninety (90) day period prior to the Closing Date. In the event that the audit reveals that the Company and/or the Partnership have (a) collected accounts receivable at an accelerated rate during such period, or (b) paid accounts payable at a reduced or delayed rate during such period, Vision 21 shall seek an adjustment to the Merger Consideration. In the event that the proposed adjustment materially impacts the goodwill which may be created by the transaction, the proposed adjustment shall take into account the related impact upon net income created by the change in amortization of such goodwill. Vision 21 shall notify the Physician in writing within seventy-five (75) days of the Closing Date of its decision to seek an adjustment of the Merger Consideration, the amount of the proposed adjustment and its reasons for such decision. If Physician does not notify Vision 21 within ten (10) days of Physician's receipt of such notice that Physician objects to the proposed adjustment, then the proposed adjustment shall take place and shall be final. If Physician notifies Vision 21 within the above-described ten (10) day period that Physician objects to the proposed adjustment, then Vision 21 and Physician shall in good faith negotiate an appropriate amount of the adjustment, if any, which should be made. During all time periods following Vision 21's notice that it intends to adjust the Merger Consideration until the adjustment is finalized, Vision 21 shall provide to Physician and his accountants full access to all relevant books, records and work papers utilized in preparing the proposed Merger Consideration adjustment. The adjustment may be settled in cash (which shall be set-off from moneys due New P.A. pursuant to the Business Management Agreement) or Vision 21 Common Stock at the Physician's option.

Merger Consideration Adjustments. Ernst & Young, LLP shall within seventy-(a) At least five (755) business days of the Closing Date conduct an audit of the Company and the Partnership to ensure that the Company and the Partnership have collected accounts receivable and paid accounts payable in the ordinary course of business during the ninety (90) day period prior to the Closing Date, the Company shall prepare and deliver to Buyer a good faith estimate, prepared in accordance with GAAP, except as noted thereon, applied in a manner consistent with the preparation of the Company Financial Statements, but including normal GAAP year-end adjustments, and accompanied by a certificate of the Chief Financial Officer of the Company, of the estimated Accounts Receivable and Accounts Payable as of the Closing Date (the “Estimate Statement”), which Estimate Statement shall be reasonably acceptable to Buyer; provided that Buyer’s belief that the Estimate Statement is reasonable at that time shall not foreclose, prevent, limit or preclude any rights or remedy of Buyer set forth herein. In the event that the audit reveals that parties fail to resolve their disagreements over the Company and/or disputed items prior to the Partnership have (a) collected accounts receivable at an accelerated rate during such periodClosing, the Estimate Statement as originally provided to Buyer, or with those modifications, if any, to which the parties shall have agreed shall be deemed to be the Estimate Statement. If the Accounts Payable exceed the Accounts Receivable by more than $350,000, then the Cash Consideration paid at Closing shall be decreased to the extent of such excess. (b) paid accounts payable at a reduced or delayed rate during such periodAs promptly as practicable after the Closing Date, Vision 21 shall seek an adjustment but in no event more than sixty (60) days following the Closing Date, Buyer will prepare and deliver to the Securityholders’ Representative a reasonably detailed statement (the “Buyer Statement”) setting forth the Accounts Receivables and Accounts Payable as of the Closing Date. If the Securityholders’ Representative has not received a Buyer Statement within sixty (60) days following the Closing Date, the Estimate Statement shall be final and binding on the parties hereto without any further action. Buyer shall prepare the Buyer Statement consistent with the basis of the preparation of the Estimate Statement. Unless within thirty (30) days after its receipt of Buyer Statement the Securityholders shall deliver to Buyer a reasonably detailed statement describing their objections to Buyer Statement (a “Statement of Objection”), the amount of Accounts Receivable and Accounts Payable at the Closing Date as set forth on Buyer Statement shall be final and binding on the parties hereto and Buyer Statement shall be the final statement hereunder (the “Closing Date Statement”). (c) If the Securityholders’ Representative delivers to Buyer a timely Statement of Objection, Buyer and the Securityholders’ Representative and their respective independent accountants shall negotiate in good faith and use reasonable best efforts to resolve any dispute. If the parties resolve their disagreements in accordance with the foregoing sentence, the Closing Date Statement with those modifications, if any, to which the parties shall have agreed shall be deemed to be the Closing Date Statement. If a final resolution is not reached within thirty (30) days after Buyer or the Securityholders’ Representative have submitted their Statement of Objection, any remaining disputes shall be resolved by an independent accounting firm of national standing selected jointly by the parties (the “Reviewing Accountants”). The Reviewing Accountants shall be instructed to limit its review to matters specifically set forth in the Statement of Objections and to resolve any matters in dispute as promptly as practicable, but in no event more than thirty (30) days after such matters have been submitted to them, and to set forth their resolution in a statement (the “Accountant Statement”) setting forth the Accounts Receivable and Accounts Payable as of the Closing Date. With respect to any disputed matter, the Reviewing Accountants may select Buyer’s figure, the Securityholders’ Representative’s figure or a figure between the two. The Reviewing Accountant shall act as an arbitrator to determine, based solely on the terms of this Merger ConsiderationAgreement (including the definition of Accounts Receivable and Accounts Payable set forth herein) and the presentations by the parties and not by independent review of legal, accounting or factual matters, only those issues in dispute. In no event may the event that Reviewing Accountant consider any issues, amounts or matters not disputed in a Statement of Objection delivered within the proposed adjustment materially impacts applicable 30-day period. The determination of the goodwill which Reviewing Accountants shall be final and binding on the parties hereto. (d) The fees and expenses of the Reviewing Accountants shall be borne by Buyer and the Securityholders in inverse proportion as they may prevail on matters resolved by the Reviewing Accountants, and such proportionate allocation shall also be determined by the Reviewing Accountants when their determination is rendered on the merits of the matter submitted. The Securityholders’ Representative and Buyer shall cooperate with each other and any Reviewing Accountants in connection with the matters contemplated by this Section 2.12, including Buyer’s preparation of and the Securityholders’ Representative’s review of Buyer Statement, in each case including by furnishing such information and access to books, records (including accountants’ work papers), personnel and properties as may be created by the transaction, the proposed adjustment shall take into account the related impact upon net income created by the change in amortization of such goodwill. Vision 21 shall notify the Physician in writing within seventy-five reasonably requested. (75e) Within three (3) days after the final determination of the Closing Date of its decision Statement in accordance with this Section 2.12, if the Closing Date Statement reflects an increase in amount (if any) by which the Accounts Payable exceed the Accounts Receivables as compared to seek an adjustment of the Merger ConsiderationEstimate Statement (such difference, the amount of the proposed adjustment and its reasons for such decision. If Physician does not notify Vision 21 within ten (10) days of Physician's receipt of such notice that Physician objects to the proposed adjustment“Adjustment Payment”), then the proposed adjustment shall take place and Buyer shall be final. If Physician notifies Vision 21 within entitled to such Adjustment Payment and the above-described ten Adjustment Payment shall be satisfied solely from the Holdback Amount in accordance with Section 2.13. (10f) day period that Physician objects The Securityholders’ portion of any fees and expenses due to the proposed adjustment, then Vision 21 Reviewing Accountants or any other third-party fees and Physician shall in good faith negotiate an appropriate amount expenses of the adjustment, if any, which should be made. During all time periods following Vision 21's notice that it intends to adjust Securityholders’ and/or the Merger Consideration until Securityholders’ Representative incurred in connection with complying with Section 2.12(b) or Section 2.12(c) (the adjustment is finalized, Vision 21 shall provide to Physician and his accountants full access to all relevant books, records and work papers utilized in preparing the proposed Merger Consideration adjustment. The adjustment may be settled in cash (which “Securityholders’ Fees”) shall be set-off satisfied out of the Holdback Amount, as adjusted from moneys due New P.A. pursuant time to time; provided, that the Business Management Agreement) or Vision 21 Common Stock at Securityholders’ Fees shall not exceed $25,000 in the Physician's optionaggregate.

Merger Consideration Adjustments. Ernst & Young(a) Parent shall, LLP no later than 5:00 p.m. Central Standard Time on the date that is the later of: (i) 75 days after Closing and (ii) 30 days after the date that the Required Parent Financial Statements have been provided to Parent (the “Review Period”), prepare a revised closing statement setting forth a good faith estimate of the Closing Adjusted Merger Consideration and the calculation thereof, including reasonable detail of the calculation of the Merger Consideration Adjustments and the Customer Prepayment Amount and Volume Shortfall Adjustment Amount, and in the case of the calculation of Net Working Capital, using the same line items in, and using the same accounting methodology as applied by the Acquired Companies on a historical basis, the example calculation set forth on Schedule 1.1(a) (the “Purchaser Closing Statement” and together with the Initial Closing Statement, the “Closing Statements”) and deliver such Purchaser Closing Statement to the Stockholders’ Representative. (b) If the Purchaser Closing Statement delivered by Purchaser to the Stockholders’ Representative in accordance with Section 2.7(a) contains any adjustments to the Closing Adjusted Merger Consideration, and any adjustment to the Customer Prepayment Amount or the Volume Shortfall Adjustment Amount, then Purchaser and the Stockholders’ Representative shall use their commercially reasonable efforts to agree on the calculation of the Closing Adjusted Merger Consideration (as may be revised by mutual agreement, the “Revised Closing Adjusted Merger Consideration”) and Customer Prepayment Amount (as may be revised by mutual agreement, the “Revised Customer Prepayment Amount”) and the Volume Shortfall Adjustment Amount (as may be revised by mutual agreement, the “Revised Volume Shortfall Adjustment Amount”), within seventyforty-five (7545) days following receipt by the Stockholders’ Representative of the Purchaser Closing Date conduct Statement (the “Objection Period”). Any such discussions between the Stockholders’ Representative and Purchaser shall not be communicated to the Independent Accountant by either such Person, shall be subject to Federal Rule of Evidence 408 and shall be deemed not discoverable by any Person in any Legal Proceeding. (c) If Purchaser and the Stockholders’ Representative are unable to reach an audit agreement as to such amounts and adjustments within such Objection Period, then at any time thereafter, either Purchaser or the Stockholders’ Representative may submit all such unagreed matters (by providing written notice thereof to the other) to Gxxxx Xxxxxxxx LLP or if Gxxxx Xxxxxxxx LLP is unwilling or unable to serve in such capacity, to such other independent accounting firm agreed to by Purchaser and the Stockholders’ Representative (such accounting firm, the “Independent Accountant”), who shall, as an expert and not as an arbitrator, resolve the matters still in dispute by adjusting the Closing Adjusted Merger Consideration and the components of such calculation contained in the Closing Statements (such amount as adjusted by the Independent Accountant, the “Final Closing Adjusted Merger Consideration”) or the Customer Prepayment Amount (such amount as adjusted by the Independent Accountant, the “Final Customer Prepayment Amount”) or the Volume Shortfall Adjustment Amount (such amount as adjusted by the Independent Accountant, the “Final Volume Shortfall Adjustment Amount”), to reflect such resolution; provided, however, that the Independent Accountant may not make any adjustments thereto that are larger or smaller in magnitude than those requested by Purchaser or the Stockholders’ Representative. The Parties shall use commercially reasonable efforts to cause the Independent Accountant to make such determination within forty-five (45) days following the submission of the Company matter to the Independent Accountant for resolution, and such determination shall, absent manifest clerical error or fraud, be final and binding upon the Partnership Parties and may be entered and enforced in any court having competent jurisdiction. Each Party agrees that it shall not have any right to, and shall not, institute a Legal Proceeding of any kind challenging such determination or with respect to ensure the matters that are the subject of this Section 2.7(c), except that the Company foregoing shall not preclude a Legal Proceeding to enforce such determination. If any dispute is submitted to the Independent Accountant as provided in this Section 2.7(c), the fees, costs, charges and expenses of the Partnership have collected accounts receivable Independent Accountant shall be paid one-half by Purchaser and paid accounts payable one-half by the Stockholders’ Representative (with the latter payment to come from the Stockholders’ Representative’s Expense Fund). (d) The extent to which the Revised Closing Adjusted Merger Consideration or the Final Closing Adjusted Merger Consideration, as applicable, is greater (a positive difference) or less than (a negative difference) the Closing Adjusted Merger Consideration shall be the “Adjustment Amount” and such amount shall be settled in cash. (i) If the Adjustment Amount is a negative difference and less in absolute value than the Adjustment Holdback Amount, within five Business Days after the determination of the Adjustment Amount, Purchaser shall, by wire transfer of immediately available funds, pay to the Paying Agent, for further payment to the Stockholders, an amount equal to the difference between (A) the Adjustment Holdback Amount minus (B) the Adjustment Amount, if such resulting amount is greater than zero, to be allocated based on each Stockholder’s Pro Rata Share set forth in the ordinary course Consideration Statement. For clarity, if this subsection applies, Purchaser shall be entitled to retain any portion of business during the ninety Adjustment Holdback Amount in excess of the Adjustment Amount (90if any) day period prior and no Stockholder shall have any right therefor or in respect thereof. (ii) If the Adjustment Amount is a negative difference and greater in absolute value than the Adjustment Holdback Amount, then Purchaser shall be entitled to retain the entire Adjustment Holdback Amount and, within five Business Days after the determination of the Adjustment Amount, RemainCo shall, by wire transfer of immediately available funds, pay to Purchaser (to an account designated by Purchaser in writing to the Closing Date. In Stockholders’ Representative) an amount equal to the event difference between (A) the Adjustment Amount minus (B) the Adjustment Holdback Amount. (iii) If the Adjustment Amount is a positive difference, then within five (5) Business Days after the determination of the Adjustment Amount, Purchaser shall, by wire transfer of immediately available funds, pay to the Paying Agent, for further payment to the Stockholders, an amount equal to the sum of (A) the Adjustment Amount and (B) the Adjustment Holdback Amount, to be allocated based on each Stockholder’s Pro Rata Share set forth in the Consideration Statement. (iv) If the Adjustment Amount is equal to zero, Purchaser shall, by wire transfer of immediately available funds, pay to the Paying Agent, for further payment to the Stockholders, an amount equal to the Adjustment Holdback Amount, to be allocated based on each Stockholder’s Pro Rata Share set forth in the Consideration Statement. (e) Notwithstanding anything to the contrary in this Agreement, the Parties agree that any Adjustment Amount shall, to the audit reveals that the Company and/or the Partnership have (a) collected accounts receivable at an accelerated rate during such periodmaximum extent permitted by applicable Law, or (b) paid accounts payable at a reduced or delayed rate during such period, Vision 21 shall seek be treated as an adjustment to the Closing Adjusted Merger Consideration. In Consideration for all U.S. federal income and applicable state, local and non-U.S. Tax purposes. (f) Notwithstanding the event that foregoing, in lieu of the proposed cash settlement described above, any difference between (i) the Estimated Customer Prepayment Amount and the Revised Customer Prepayment Amount or Final Customer Prepayment Amount, as applicable, or (ii) the Estimated Volume Shortfall Adjustment Amount and the Revised Volume Shortfall Adjustment Amount or the Final Volume Shortfall Adjustment Amount, as applicable, in each case as finally determined pursuant to this Section 2.7, shall be settled by adjustment materially impacts to the goodwill which may be created by principal amount under the transactionDeferred Cash Consideration Note in accordance with the terms thereof and without further action of the Stockholders, the proposed adjustment shall take into account the related impact upon net income created by the change in amortization of such goodwill. Vision 21 shall notify the Physician in writing within seventy-five (75) days of the Closing Date of its decision to seek an adjustment of the Merger Consideration, the amount of the proposed adjustment and its reasons for such decision. If Physician does not notify Vision 21 within ten (10) days of Physician's receipt of such notice that Physician objects to the proposed adjustment, then the proposed adjustment shall take place and shall be final. If Physician notifies Vision 21 within the above-described ten (10) day period that Physician objects to the proposed adjustment, then Vision 21 and Physician shall in good faith negotiate an appropriate amount of the adjustment, if any, which should be made. During all time periods following Vision 21's notice that it intends to adjust the Merger Consideration until the adjustment is finalized, Vision 21 shall provide to Physician and his accountants full access to all relevant books, records and work papers utilized in preparing the proposed Merger Consideration adjustment. The adjustment may be settled in cash (which shall be set-off from moneys due New P.A. pursuant to the Business Management Agreement) Stockholders’ Representative or Vision 21 Common Stock at the Physician's optionPurchaser.

Merger Consideration Adjustments. Ernst & Young, LLP shall within seventy-(A) The Parties agree that the determination of the amount of Merger Consideration that is payable at Closing was based on (i) an assumed Closing Net Working Capital in the amount of $7,400,000 (“Target Net Working Capital”) and (ii) an assumed Closing Outstanding Net Debt equal to the Reference Date Net Debt. (B) No less than five (755) days of the Closing Date conduct an audit of the Company and the Partnership to ensure that the Company and the Partnership have collected accounts receivable and paid accounts payable in the ordinary course of business during the ninety (90) day period Business Days prior to the Closing Date. In the event that the audit reveals that Date the Company and/or shall prepare and deliver to Parent for Parent’s review, and the Partnership have Company and Parent shall mutually agree in good faith on, estimates of (ai) collected accounts receivable at an accelerated rate during such period, or (b) paid accounts payable at a reduced or delayed rate during such period, Vision 21 shall seek an adjustment to the Merger Consideration. In the event that the proposed adjustment materially impacts the goodwill which may be created by the transaction, the proposed adjustment shall take into account the related impact upon net income created by the change in amortization of such goodwill. Vision 21 shall notify the Physician in writing within seventy-five (75) days Existing Company Indebtedness as of the Closing Date Date, the Closing Cash, and the Closing Outstanding Net Debt (the last of its decision to seek an adjustment such estimates, the “Estimated Closing Outstanding Net Debt”) (ii) Estimated Closing Taxes, and (iii) Closing Net Working Capital (such estimate, the “Estimated Closing Working Capital”). If Parent and the Company cannot agree on the Estimated Closing Outstanding Net Debt, Estimated Closing Taxes, and/or the Estimated Closing Working Capital, then the amount(s) of such item(s) shall be as set forth in the Sample Merger Consideration Calculation. For purposes of the payments to be made by Parent (upon surrender of the Certificates representing shares in accordance with Section 2.02(b)) at or following the Closing until the Final Closing Outstanding Net Debt, Closing Taxes, and Final Closing Working Capital are determined pursuant to this Agreement, such payments shall be made on the basis of estimated Merger ConsiderationConsideration calculated on the assumption that the Final Closing Outstanding Net Debt will be equal to the Estimated Closing Outstanding Net Debt, Closing Taxes will be equal to Estimated Closing Taxes, and the Final Closing Working Capital will be equal to the Estimated Closing Working Capital. Such estimated Merger Consideration shall be subject to adjustment as provided in Sections 2.01(d)(C) through (I) below. (C) As promptly as practicable, but no later than 60 days after the Closing Date, Parent and the Surviving Corporation shall prepare and deliver to the Representative a closing statement (the “Closing Statement”) and a certificate signed by an executive officer of the Parent (the “Closing Certificate”) based on such Closing Statement setting forth the Surviving Corporation’s calculation of Closing Outstanding Net Debt, Closing Taxes, and Closing Net Working Capital. Parent and the Surviving Corporation will permit a person designated by the Representative to participate in the preparation of the Closing Statement (solely for purposes of understanding the process and without any right to specify the content of the Closing Statement). Closing Net Working Capital shall be determined on the same basis and using the same accounting principles, practices, assumptions, methodologies, and policies used in the preparation of the December 31, 2005, audited consolidated financial statements of ECCA and its Subsidiaries, including the notes thereto, included in the ECCA SEC Documents (collectively, the “Working Capital Principles”). A sample calculation of Net Working Capital is set forth on Exhibit C (the “Sample Working Capital Calculation”). The Sample Working Capital Calculation was determined in accordance with the Working Capital Principles. (D) Upon the Representative’s review of the Closing Statement, if the Representative disagrees with the Surviving Corporation’s calculation of the Closing Outstanding Net Debt, Closing Taxes, and/or the Closing Net Working Capital set forth in the Closing Certificate, the Representative may, within 15 days after delivery of the Closing Statement, deliver a written notice to the Surviving Corporation, with a copy to Parent, disagreeing with any such calculation and setting forth the Representative’s calculation of such amount (a “Notice of Disagreement”). Any such Notice of Disagreement shall specify, in reasonable detail, those items or amounts as to which the Representative disagrees. (E) If a Notice of Disagreement shall be duly delivered pursuant to Section 2.01(d)(D), the Representative and the Surviving Corporation shall, during the 15 days following such delivery, use their commercially reasonable efforts to reach agreement on the disputed items or amounts in order to determine, as may be required, the amount of the proposed adjustment Closing Outstanding Net Debt and/or the Closing Net Working Capital, as applicable. If during such period, the Representative and the Surviving Corporation are unable to reach such agreement, they shall promptly thereafter cause KPMG LLP (the “Accounting Referee”) to review this Agreement and the disputed items or amounts for the purpose of calculating the Closing Outstanding Net Debt, Closing Taxes, and/or the Closing Net Working Capital, as applicable. If such firm is unable to serve in such capacity, another firm of independent accountants of nationally recognized standing reasonably satisfactory to Parent, the Surviving Corporation and the Representative (which shall not have or have had any material relationship with Parent, the Surviving Corporation or the Representative) shall be selected in its reasons stead. If Parent, the Surviving Corporation and the Representative cannot agree upon an independent accounting firm to be the firm that will act to determine the Closing Outstanding Net Debt, Closing Taxes and/or the Closing Net Working Capital, as provided in the immediately preceding sentence, within 30 days after the end of the aforesaid 30-day period, then the Supreme Court of the County and State of New York, in a proceeding brought in accordance with Article 76 of the New York Civil Practice Law and Rules (“CPLR”), shall be empowered to select such an accounting firm. In any such case, a single partner of the selected accounting firm shall act for the firm in the determination proceeding, and such partner shall render a written decision as to each such disputed matter, as promptly as practicable, but, in any case, no later than 30 days from the date of the engagement of the Accounting Referee, including a statement in reasonable detail of the basis for each such decision. If Physician does In making such calculation, the Accounting Referee shall consider only those items or amounts in the Closing Statement and the Surviving Corporation’s calculation of Closing Outstanding Net Debt, Closing Taxes, and/or Closing Net Working Capital as to which Representative has disagreed. The Accounting Referee’s determination as to any item or amount disputed by the Representative shall not notify Vision 21 within ten (10) days be more beneficial to the Surviving Corporation than the determination of Physician's receipt that item or amount by the Surviving Corporation in the Closing Statement nor more beneficial to the Representative than the determination of that item or amount in the Notice of Disagreement. Such report shall be final and binding upon the Representative and the Surviving Corporation, and will be fully enforceable under and pursuant to CPLR Article 76. The cost of such notice review and report shall be borne equally by the Company Series B-1 Shareholders, on the one hand, and the Surviving Corporation, on the other hand. The portion of the costs to be borne by the Company Series B-1 Shareholders shall be paid by the Representative on behalf of the Company Series B-1 Shareholders, solely from the Holdback that Physician objects would otherwise be payable to the proposed adjustmentCompany Series B-1 Shareholders in accordance with Section 2.01(f). (F) The Representative, Parent and the Surviving Corporation shall, and shall cause their Subsidiaries and respective representatives to, cooperate and assist in the preparation of the Closing Statement and the calculation of Closing Outstanding Net Debt, Closing Taxes, and Closing Net Working Capital and in the conduct of the review of the Representative and, if necessary, the Accounting Referee. Within the 15-day period specified in Section 2.01(d)(D), Parent and the Surviving Corporation shall, and during the 15-day period specified in Section 2.01(d)(E), the Representative shall, subject to normal procedures associated with such review, make available, on reasonable notice and during normal working hours, books, accounting records, work papers and personnel to the extent necessary or reasonably requested to verify the amounts set forth in the Closing Statement. (G) If Final Outstanding Net Debt is more than Estimated Closing Outstanding Net Debt, then the proposed adjustment shall take place and Merger Consideration shall be finaldecreased on a dollar-for-dollar basis by the full amount of such excess and such amount shall be paid to the Surviving Corporation in accordance with Section 2.01(d)(I). If Physician notifies Vision 21 within the above-described ten (10) day period that Physician objects to the proposed adjustmentFinal Outstanding Net Debt is less than Estimated Closing Outstanding Net Debt, then Vision 21 and Physician shall in good faith negotiate an appropriate amount of the adjustment, if any, which should be made. During all time periods following Vision 21's notice that it intends to adjust the Merger Consideration until the adjustment is finalized, Vision 21 shall provide to Physician and his accountants full access to all relevant books, records and work papers utilized in preparing the proposed Merger Consideration adjustment. The adjustment may be settled in cash (which shall be set-off from moneys due New P.A. pursuant to the Business Management Agreement) or Vision 21 Common Stock at the Physician's option.increased on a

Merger Consideration Adjustments. Ernst & Young, LLP (a) The Merger Consideration shall within seventy-be subject to adjustment on a dollar for dollar basis as set forth in this Section 1.09. (b) Not less than five (755) days of the Closing Date conduct an audit of the Company and the Partnership to ensure that the Company and the Partnership have collected accounts receivable and paid accounts payable in the ordinary course of business during the ninety (90) day period Business Days prior to the Closing Date, the Company shall deliver to Parent a statement (the “Estimated NTAV Statement”) of the estimated Net Tangible Asset Value as of the Closing Date (the “Estimated NTAV”). The Estimated NTAV Statement shall be based on the estimated consolidated balance sheet of the Company (excluding the TMG Business and TMG) as of the close of business on the Closing Date in accordance with GAAP and on a basis consistent with the Company’s past principles, policies and practices as reflected in the Interim Financial Statements (so long as and only in the event that such past principles, policies and practices conform with GAAP) and without giving effect to the consummation of the transactions contemplated hereby, other than the TMG Distribution, except that it shall include an accrual for the Performance Unit Amounts, Other Employee Payments, the TMG Excluded Liabilities and the Transaction Expenses, provided, however, that the Estimated NTAV Statement shall be subject to and prepared in conformity with year-end audit accrual and estimation practices of the Company such that all pro-rata adjustments, accruals, reserves, allowances and similar year-end adjustments are prepared for and included in the Estimated NTAV Statement, as if the Estimated NTAV Statement were a year-end statement. The accounting principles governing the Financial Statements shall eliminate all intercompany transactions and investments. The Company shall consult with Parent regarding its calculation of Estimated NTAV prior to delivery of the Estimated NTAV Statement. To the extent that the Estimated NTAV is less than negative Seven Million Nine Hundred Thirty-Seven Thousand Dollars (negative $7,937,000) (the “Target NTAV”), the Merger Consideration payable at Closing will be decreased by the Estimated NTAV Shortfall. To the extent that the Estimated NTAV is greater than the Target NTAV, the Merger Consideration payable at Closing will be increased by the Estimated NTAV Excess. An example of the NTAV calculation is set forth on Schedule 1.09 to this Agreement (the “NTAV Example”). The Estimated NTAV shall be prepared on the same basis as the NTAV Example. Nothing disclosed in Section 2.10 of the Disclosure Schedule shall affect the terms (including, without limitation, the amount of the Target NTAV) or the parties’ obligations set forth in this Section 1.09. (c) Within ninety (90) days after the Closing Date, Parent shall prepare and deliver to the Stockholder Representative (or its designee) a statement (the “NTAV Statement”) setting forth the actual NTAV as of the Closing Date (the “Closing NTAV”). The NTAV Statement shall be based on the consolidated balance sheet of the Company (excluding the TMG Business and TMG) as of the close of business on the Closing Date in accordance with GAAP and on a basis consistent with the Company’s past principles, policies and practices as reflected in the Interim Financial Statements (so long as and only in the event that such past principles, policies and practices conform with GAAP) and without giving effect to the consummation of the transactions contemplated hereby, other than the TMG Distribution, except that it shall include an accrual for the Performance Unit Amounts, Other Employee Payments and the Transaction Expenses, provided, however, that the NTAV Statement shall be subject to and prepared in conformity with year-end audit accrual and estimation practices of the Company such that all pro-rata adjustments, accruals, reserves, allowances and similar year-end adjustments are prepared for and included in the NTAV Statement, as if the XXXX Xxxxxxxxx were a year-end statement. The accounting principles governing the Financial Statements shall eliminate all intercompany transactions and investments. The methods, principles and assumptions used in the NTAV Example shall be the methods, principles and assumptions used for purposes of calculating the Closing NTAV, provided that if the calculation in the NTAV Example is determined not to be in accordance with GAAP, then the calculation in the NTAV Example shall be adjusted so as to be in accordance with GAAP. In addition, and notwithstanding the foregoing, if the Closing Date does not occur as of a month end, then the NTAV calculation for the month during which the Closing Date occurs shall prorate any items that have been accrued in accordance with GAAP for a full monthly period. (d) If the Stockholder Representative disputes the NTAV Statement (either as to content or manner of preparation), then the Stockholder Representative shall, within sixty (60) days following receipt of the NTAV Statement from Parent, deliver a written notice to Parent of such dispute setting forth in reasonable detail the basis for that dispute. If the Stockholder Representative does not so notify Parent of a dispute within such sixty (60) day period, the Closing NTAV shall be deemed to be final, conclusive and binding on the parties. In the event the Stockholder Representative delivers a notification of a dispute, Parent and the Stockholder Representative shall negotiate in good faith to resolve such dispute; provided, however, that if Parent and the Stockholder Representative fail to resolve such dispute within thirty (30) Business Days after notification of the dispute, then Parent and the Stockholder Representative shall promptly (but in no event later than thirty (30) days thereafter) engage KPMG LLP, New York, New York (provided that if KPMG is unable or unwilling to perform the engagement, the parties will mutually agree upon an independent nationally recognized accounting firm to perform the engagement) (the “Accounting Expert”) to resolve such dispute. Parent and the Stockholder Representative shall have the opportunity to provide written submissions relating to whether the standards set forth in Section 1.09, including the NTAV Example, have been met, which written submissions shall be provided to the Accounting Expert, if at all, no later than fifteen (15) Business Days after the date of referral of the disputed matters to the Accounting Expert. The Accounting Expert shall deliver a written report resolving only the disputed matters relating to whether the standards set forth in Section 1.09 have been met, and setting forth the basis for such resolution within thirty (30) Business Days after Parent and the Stockholder Representative have submitted in writing (or have had the opportunity to submit in writing but have not submitted) their positions as to the disputed items. Parent shall be responsible for all of the fees and expenses of the Accounting Expert unless the Accounting Expert finds the Closing NTAV is equal to or less than the Closing NTAV reflected in the NTAV Statement in which case the amount of all fees and expenses of the Accounting Expert shall be paid as provided in Section 1.09(f) below. All determinations made by the Accounting Expert will be final, conclusive and binding on the parties. The Closing NTAV as finally determined in accordance with this Section 1.09 shall be the “Final NTAV.” (e) For purposes of complying with the terms set forth in this Section 1.09, the parties shall cooperate with and make available to the other parties and their respective representatives all information, records, data and working papers, and shall permit access to their facilities and personnel, as may be reasonably required in connection with the preparation and analysis of the Estimated NTAV and the NTAV Statement and the resolution of any disputes thereunder. (f) Parent shall be entitled to withhold from payment of the Merger Consideration Five Hundred Thousand Dollars ($500,000) (the “Holdback Amount”) to satisfy a Final NTAV Shortfall, if any, in accordance with this Section 1.09(f). If the Final NTAV is less than the Estimated NTAV, the Merger Consideration shall be adjusted downward by the amount of the Final NTAV Shortfall, and (i) Parent shall be entitled to keep and not distribute to the Paying Agent an amount equal to the Final NTAV Shortfall and (ii) after Parent’s retention of an amount equal to the Final NTAV Shortfall in accordance with subparagraph (i), Parent shall, within five (5) Business Days of the date on which Final NTAV is determined pursuant to this Section 1.09, deliver to the Paying Agent an amount in cash equal to the difference between the Holdback Amount and the Final NTAV Shortfall, which amount shall then be distributed by the Paying Agent to the record holders of Outstanding Shares in proportion to their percentage ownership of all Outstanding Shares. In the event that the audit reveals that Final NTAV Shortfall is greater than the Company and/or Holdback Amount, Parent shall be entitled to recover the Partnership have amount of such difference by making a claim against the Indemnity Escrow Account. (ag) collected accounts receivable at an accelerated rate during such periodIf the Final NTAV is greater than the Estimated NTAV, or (b) paid accounts payable at a reduced or delayed rate during such period, Vision 21 shall seek an adjustment to then the Merger Consideration. In the event that the proposed adjustment materially impacts the goodwill which may Consideration shall be created increased by the transaction, the proposed adjustment shall take into account the related impact upon net income created by the change in amortization of such goodwill. Vision 21 shall notify the Physician in writing within seventy-five (75) days of the Closing Date of its decision to seek an adjustment of the Merger Consideration, the amount of the proposed adjustment Final NTAV Excess, and its reasons for such decision. If Physician does not notify Vision 21 within ten (10) days of Physician's receipt of such notice that Physician objects Parent shall deliver to the proposed adjustment, then the proposed adjustment shall take place and shall be final. If Physician notifies Vision 21 within the above-described ten (10) day period that Physician objects Paying Agent an amount in cash equal to the proposed adjustment, then Vision 21 and Physician shall in good faith negotiate an appropriate amount sum of the adjustment, if anyFinal NTAV Excess and the Holdback Amount, which should amount shall then be madedistributed by the Paying Agent to the record holders of Outstanding Shares in proportion to their percentage ownership of all Outstanding Shares. During all time periods following Vision 21's notice that it intends Payment of any Final NTAV Excess and the Holdback Amount is to adjust be made within five (5) Business Days of the Merger Consideration until the adjustment date on which Final NTAV is finalized, Vision 21 shall provide to Physician and his accountants full access to all relevant books, records and work papers utilized in preparing the proposed Merger Consideration adjustment. The adjustment may be settled in cash (which shall be set-off from moneys due New P.A. determined pursuant to the Business Management Agreement) or Vision 21 Common Stock at the Physician's optionthis Section 1.09.