Common use of PRE-CLOSING AND POST-CLOSING ADJUSTMENTS Clause in Contracts

PRE-CLOSING AND POST-CLOSING ADJUSTMENTS. 5.1 Upon the issuance of the audited financial statements by Seller's accountant, Xxxxxx & Xxxxxx, P.C., Seller will deliver to Purchaser a determination of Company's Pro Forma EBIT prepared by Company's accountant for the subject period along with any supporting documentation reasonably requested by Purchaser. Within ten days following delivery to Purchaser of such report and prior to Closing, Purchaser shall have the right to object in writing to the results contained in such determination. If timely objection is not made by Purchaser of such determination, such determination shall become final and binding. If timely objection is made by Purchaser to Seller, and Purchaser and Seller are able to resolve their differences in writing within five (5) days following the expiration of the Pro Forma EBIT objection period, then such determination as resolved shall become final and binding as it relates to this Agreement. If timely objection is made by Purchaser to Seller, and Seller and Purchaser are unable to resolve their differences in writing within five (5) days following the expiration of the Pro Forma EBIT objection period, then all disputed matters relating to the report shall be submitted to and reviewed by an arbitrator (the _Arbitrator_) which shall be an independent accounting firm selected by Seller and Purchaser. If Purchaser and Seller are unable to agree promptly on the accounting firm to serve as the Arbitrator, each shall select, by not later than the seventh day following the Pro Forma EBIT objection period, an accounting firm, and each selected accounting firm shall be instructed to jointly select promptly another accounting firm, such third accounting firm shall serve as the Arbitrator. The Arbitrator shall consider only the disputed matters pertaining to the determination and shall act promptly and fairly to resolve all disputed matters and their decision with respect to all disputed matters shall be final and binding upon Seller and Purchaser. The expenses of the arbitration (including reasonable attorney and accounting fees) shall be borne one-half by Purchaser and one-half by Seller. Any net reduction in the Purchase Price as a result of said adjustments shall be made in the manner set forth in Section 4.1(c) and shall be reflected by decreasing the face amount of the note set forth in Section 4.2(c). 5.2 Within fifteen (15) days after the Closing, Seller shall prepare and deliver to Purchaser a Pro Forma Balance Sheet which shall set forth the Purchased Assets, and the Assumed Liabilities as of such date. The Pro Forma Balance Sheet shall be prepared using the same accounting methods, policies, practices and procedures, with consistent classifications, judgments, estimations and methodologies as used in the preparation of the October 31, 1997 Pro Forma Balance Sheet. If the Net Asset Amount (as defined below) shown on the Pro Forma Balance Sheet is less than $600,000.00, the Purchase Price to be paid to Seller shall be decreased on a dollar-for-dollar basis for such difference by decreasing the face amount of the note as set forth in Section 4.2(c) and if the decrease is in excess of the face amount of the note, such amount equal to the excess shall be paid immediately by Seller to Purchaser by certified or cashier's check on the date of the resolution of this determination. If the Net Asset Amount shown on the Pro Forma Balance Sheet equals or exceeds $600,000,00, Purchaser shall be entitled to such excess. The Net Asset Amount shall mean the total of the Purchased Assets less the total of the Assumed Liabilities, in each case as shown on the Pro Forma Balance Sheet. 5.3 Within forty-five (45) days after the end of the applicable periods set forth in Section 4.1(e), i.e. January 6, 1999, January 6, 2000 and March 5, 2000, Purchaser will deliver to Seller a copy of the report of EBIT prepared by Purchaser for the subject period along with any supporting documentation reasonably requested by Seller. Within thirty (30) days of delivery to Seller of such report, Seller shall have the right to object in writing to the results contained in such determination. If timely objection is not made by Seller to such determination, such determination shall become final and binding for purposes of this Agreement. If timely objection is made by Seller to Purchaser and Purchaser and Seller are able to resolve their differences in writing within thirty (30) days following the expiration of the thirty-day period, then such determination shall become final and binding as it relates to this Agreement. If timely objection is made by Seller to Purchaser and Seller and Purchaser are unable to resolve their differences in writing within thirty (30) days following the expiration of the thirty-day period, then all disputed matters pertaining to the report shall be submitted to and reviewed by an Arbitrator (the _Arbitrator_) which shall be an independent accounting firm selected by Purchaser and Seller. If Purchaser and Seller are unable to agree promptly upon an accounting firm to serve as the Arbitrator, each shall select by no later than the thirtieth day following the expiration of the sixty (60) day period, an accounting firm and the two selected accounting firms shall be instructed to select promptly another accounting firm, such newly selected firm to serve as the Arbitrator. The Arbitrator shall consider only the disputed matters pertaining to the determination and shall act promptly to resolve all disputed matters, and its decision with respect to all disputed matters shall be final and binding upon Seller and Purchaser. The expenses of the arbitration (including reasonable attorney and accounting fees) shall be borne one-half by Seller and one-half by Purchaser. For purposes of this Section, the term _EBIT_ shall mean the net income before taxes and interest expense of Purchaser's Virginia and West Virginia Service Division. The EBIT shall be determined by the independent accountant regularly retained by the Purchaser in the manner set forth above in accordance with generally accepted accounting principles, subject to verification as described below. For purposes of determining the EBIT for any particular year, except as noted above, no item of income or expense will be allocated by Purchaser to Purchaser's Virginia/West Virginia Service Division unless such items are reasonably calculated to contribute to the increased profits of such Division, it being the intent of the parties that Purchaser shall exercise the utmost good faith with respect to allocations of income and expense to Purchaser's Virginia/West Virginia Service Division. Incident to the determination of EBIT of Purchaser's Virginia/West Virginia Service Division, no compensation of any executive or other employee of Purchaser or its affiliates who does not work directly for Purchaser's Virginia/West Virginia Service Division shall be allocated to such Division. In making the determination of EBIT for the Purchaser's Virginia/West Virginia Service Division for calendar year 1 following the Closing, a one and one-half percent (1.5%) MAS royalty fee on gross sales by the Purchaser's Virginia/West Virginia Service Division shall be made incident to said determination. A MAS royalty fee is a fee charged to each branch of the Purchaser for the following services performed by Purchaser's corporate headquarters: marketing, advertising, professional, accounting and other related expenses. For each subsequent year described above in this paragraph, the parties shall, in good faith, agree upon an MAS royalty fee to be charged hereunder based on the level of services and support being provided by the Purchaser to its Virginia/West Virginia Service Division. Provided, however, such MAS royalty fee shall be 1.5% if the parties are unable to come to an agreement for each subsequent year. For purposes of this Section, the term _Virginia/West Virginia Service Division_ shall be the Business acquired from Seller. Purchaser's contract with the State of West Virginia relating to computer hardware and software and services for educational purposes for K through 12 shall not be included as part of the Virginia/West Virginia Service Division.

PRE-CLOSING AND POST-CLOSING ADJUSTMENTS. 5.1 Upon (a) At least thirty (30) calendar days prior to the issuance of Closing Date, Purchaser, with the audited financial statements by assistance and participation of, and in consultation with, Seller's accountant, Xxxxxx & Xxxxxx, P.C., Seller will shall prepare and deliver to Purchaser a determination Seller an estimated closing statement (the “Estimated Closing Statement”) that shall set forth Purchaser’s best estimate of Company's Pro Forma EBIT prepared all estimated adjustments to the Initial Purchase Price required by Company's accountant for Section 3.2 (the subject period along with any supporting documentation reasonably requested by Purchaser“Estimated Adjustment”). Within ten (10) calendar days following after the delivery to Purchaser of such report and prior to Closing, Purchaser shall have the right to object in writing to the results contained in such determination. If timely objection is not made by Purchaser of such determination, such determination shall become final and binding. If timely objection is made Estimated Closing Statement by Purchaser to Seller, and Purchaser and Seller are able may object in good faith to the Estimated Adjustment in writing. If Seller objects to the Estimated Adjustment within such ten (10) day period, the Parties shall attempt to resolve their differences in writing within five (5) days following the expiration of the Pro Forma EBIT objection period, then such determination as resolved shall become final and binding as it relates to this Agreementby negotiation. If timely objection is made by Purchaser to Seller, and Seller and Purchaser the Parties are unable to resolve their differences in writing within five (5) days following the expiration of the Pro Forma EBIT objection period, then all disputed matters relating do so prior to the report Closing Date (or if Seller does not object to the Estimated Adjustment), the Initial Purchase Price shall be submitted to and reviewed by an arbitrator adjusted (the _Arbitrator_“Closing Adjustment”) which shall be an independent accounting firm selected at the Closing by Seller and Purchaser. If Purchaser and Seller are unable to agree promptly on the accounting firm to serve as the Arbitrator, each shall select, by not later than the seventh day following the Pro Forma EBIT objection period, an accounting firm, and each selected accounting firm shall be instructed to jointly select promptly another accounting firm, such third accounting firm shall serve as the Arbitrator. The Arbitrator shall consider only the disputed matters pertaining to the determination and shall act promptly and fairly to resolve all disputed matters and their decision with respect to all disputed matters shall be final and binding upon Seller and Purchaser. The expenses of the arbitration (including reasonable attorney and accounting fees) shall be borne one-half by Purchaser and one-half by Seller. Any net reduction in the Purchase Price as a result of said adjustments shall be made in the manner set forth in Section 4.1(c) and shall be reflected by decreasing the face amount of the note set forth Estimated Adjustment not in dispute. The disputed portion shall be resolved in accordance with the provisions of Section 4.2(c3.3(b) and paid as part of any Post-Closing Adjustment to the extent required by Section 3.3(b). 5.2 (b) Within fifteen sixty (1560) days after the ClosingClosing Date, Purchaser, with the assistance and participation of, and in consultation with, Seller shall prepare and deliver to Purchaser Seller a Pro Forma Balance Sheet which final closing statement (the “Post-Closing Statement”) that shall set forth all adjustments to the Purchased AssetsInitial Purchase Price proposed by Purchaser to be required by Section 3.2(a) through 3.2(e) not previously effected by the Closing Adjustment (the “Proposed Post-Closing Adjustment”); provided that if any adjustments to be made pursuant to Section 3.2(d) cannot be made within sixty (60) days after the Closing Date, and the Assumed Liabilities as of Parties agree that additional Post-Closing Statements can be subsequently prepared to address such dateadjustments. The Pro Forma Balance Sheet To the extent applicable, the Post-Closing Statement shall be prepared using the same accounting methodsprinciples, policies, practices policies and procedures, with consistent classifications, judgments, estimations and methodologies methods as the Operating Agent has historically used in connection with the preparation calculation of the October 31items reflected on such Post-Closing Statement. Without limiting the generality of the foregoing, 1997 Pro Forma Balance Sheet. If the Net Asset Amount (as defined below) shown on the Pro Forma Balance Sheet is less than $600,000.00for matters covered by Section 3.2(e), the Purchase Price discount rate and other assumptions used to be paid to Seller determine Pension and OPEB Liabilities as reflected in the Post-Closing Statement shall be decreased on a dollarselected using the same methodology historically used for selecting the discount rate and assumptions for Pinnacle West Capital Corporation’s consolidated fiscal year-for-dollar basis for such difference by decreasing the face amount of the note as set forth end calculations reported in Section 4.2(c) and if the decrease is in excess of the face amount of the note, such amount equal to the excess shall be paid immediately by Seller to Purchaser by certified or cashier's check on the date of the resolution of this determination. If the Net Asset Amount shown on the Pro Forma Balance Sheet equals or exceeds $600,000,00, Purchaser shall be entitled to such excess. The Net Asset Amount shall mean the total of the Purchased Assets less the total of the Assumed Liabilities, in each case as shown on the Pro Forma Balance Sheet. 5.3 Within forty-five (45) days after the end of the applicable periods set forth in Section 4.1(e), i.e. January 6, 1999, January 6, 2000 and March 5, 2000, Purchaser will deliver to Seller a copy of the report of EBIT prepared by Purchaser for the subject period along with any supporting documentation reasonably requested by Sellerits audited financial statements. Within thirty (30) days after the delivery of delivery the Post-Closing Statement by Purchaser to Seller of such reportSeller, Seller shall have the right to may object in writing good faith to the results contained Proposed Post-Closing Adjustment in such determinationwriting, stating in reasonable detail its objections thereto. If timely objection is not made by Seller to such determination, such determination shall become final and binding for purposes of this Agreement. If timely objection is made by Seller to Purchaser and Purchaser and Seller are able agree to cooperate to exchange information used to prepare the Post-Closing Statement and information relating thereto. If Seller objects to the Proposed Post-Closing Adjustment, the Parties shall attempt to resolve their differences in writing such dispute by negotiation. If the Parties are unable to resolve such dispute within thirty (30) days following after any objection by Seller, the expiration of Parties shall appoint the thirtyIndependent Accounting Firm, which shall, at Seller’s and Purchaser’s joint expense, review the Proposed Post-day periodClosing Adjustment and determine the appropriate adjustment to the Purchase Price, then such determination shall become final and binding as it relates to this Agreement. If timely objection is made by Seller to Purchaser and Seller and Purchaser are unable to resolve their differences in writing if any, within thirty (30) days following the expiration of the thirty-day period, then all disputed matters pertaining to the report shall be submitted to and reviewed by an Arbitrator (the _Arbitrator_) which shall be an independent accounting firm selected by Purchaser and Seller. If Purchaser and Seller are unable to agree promptly upon an accounting firm to serve as the Arbitrator, each shall select by no later than the thirtieth day following the expiration of the sixty (60) day period, an accounting firm and the two selected accounting firms shall be instructed to select promptly another accounting firm, after such newly selected firm to serve as the Arbitratorappointment. The Arbitrator shall consider only Parties agree to cooperate with the disputed matters pertaining Independent Accounting Firm and provide it with such information as it reasonably requests to the determination and shall act promptly enable it to resolve all disputed matters, and its decision with respect to all disputed matters shall be final and binding upon Seller and Purchaser. The expenses of the arbitration (including reasonable attorney and accounting fees) shall be borne one-half by Seller and one-half by Purchasermake such determination. For purposes of this SectionSection 3.3(b) and wherever the Independent Accounting Firm is retained to resolve a dispute between the Parties, the term _EBIT_ shall mean Independent Accounting Firm may determine the net income before taxes and interest expense issues in dispute following such procedures, consistent with the language of Purchaser's Virginia and West Virginia Service Division. The EBIT shall be determined by the independent accountant regularly retained by the Purchaser in the manner set forth above in accordance with generally accepted accounting principlesthis Agreement, subject to verification as described below. For purposes of determining the EBIT for any particular year, except as noted above, no item of income or expense will be allocated by Purchaser to Purchaser's Virginia/West Virginia Service Division unless such items are reasonably calculated to contribute it deems appropriate to the increased profits of such Divisioncircumstances and with reference to the amounts in issue. No particular procedures are intended to be imposed upon the Independent Accounting Firm, it being the intent desire of the parties Parties that Purchaser any such disagreement shall exercise the utmost good faith with respect to allocations of income be resolved as expeditiously and expense to Purchaser's Virginia/West Virginia Service Divisioninexpensively as reasonably practicable. Incident The Independent Accounting Firm shall have no liability to the Parties in connection with such services except for acts of bad faith, willful misconduct or gross negligence, and the Parties shall provide such indemnities to the Independent Accounting Firm as it may reasonably request. The finding of such Independent Accounting Firm shall be binding on the Parties hereto. Upon determination of EBIT the appropriate adjustment (the “Post-Closing Adjustment”) by agreement of Purchaser's Virginia/West Virginia Service Division, no compensation of any executive the Parties or other employee of Purchaser or its affiliates who does not work directly for Purchaser's Virginia/West Virginia Service Division shall be allocated to such Division. In making the by binding determination of EBIT for the Purchaser's Virginia/West Virginia Service Division for calendar year 1 following Independent Accounting Firm, the ClosingParty owing the difference shall deliver such amount to the other Party no later than two (2) Business Days after such determination, a one and one-half percent (1.5%) MAS royalty fee on gross sales in immediately available funds or in any other manner as reasonably requested by the Purchaser's Virginia/West Virginia Service Division shall be made incident to said determination. A MAS royalty fee is a fee charged to each branch of the Purchaser for the following services performed by Purchaser's corporate headquarters: marketing, advertising, professional, accounting and other related expenses. For each subsequent year described above in this paragraph, the parties shall, in good faith, agree upon an MAS royalty fee to be charged hereunder based on the level of services and support being provided by the Purchaser to its Virginia/West Virginia Service Division. Provided, however, such MAS royalty fee shall be 1.5% if the parties are unable to come to an agreement for each subsequent year. For purposes of this Section, the term _Virginia/West Virginia Service Division_ shall be the Business acquired from Seller. Purchaser's contract with the State of West Virginia relating to computer hardware and software and services for educational purposes for K through 12 shall not be included as part of the Virginia/West Virginia Service Divisionpayee.

PRE-CLOSING AND POST-CLOSING ADJUSTMENTS. 5.1 Upon (a) At least thirty (30) calendar days prior to the issuance of Closing Date, Purchaser, with the audited financial statements by assistance and participation of, and in consultation with, Seller's accountant, Xxxxxx & Xxxxxx, P.C., Seller will shall prepare and deliver to Purchaser a determination Seller an estimated closing statement (the “Estimated Closing Statement”) that shall set forth Purchaser’s best estimate of Company's Pro Forma EBIT prepared all estimated adjustments to the Initial Purchase Price required by Company's accountant for Section 3.2 (the subject period along with any supporting documentation reasonably requested by Purchaser“Estimated Adjustment”). Within ten (10) calendar days following after the delivery to Purchaser of such report and prior to Closing, Purchaser shall have the right to object in writing to the results contained in such determination. If timely objection is not made by Purchaser of such determination, such determination shall become final and binding. If timely objection is made Estimated Closing Statement by Purchaser to Seller, and Purchaser and Seller are able may object in good faith to the Estimated Adjustment in writing. If Seller objects to the Estimated Adjustment within such ten (10) day period, the Parties shall attempt to resolve their differences in writing within five (5) days following the expiration of the Pro Forma EBIT objection period, then such determination as resolved shall become final and binding as it relates to this Agreementby negotiation. If timely objection is made by Purchaser to Seller, and Seller and Purchaser the Parties are unable to resolve their differences in writing within five (5) days following the expiration of the Pro Forma EBIT objection period, then all disputed matters relating do so prior to the report Closing Date (or if Seller does not object to the Estimated Adjustment), the Initial Purchase Price shall be submitted to and reviewed by an arbitrator adjusted (the _Arbitrator_“Closing Adjustment”) which shall be an independent accounting firm selected at the Closing by Seller and Purchaser. If Purchaser and Seller are unable to agree promptly on the accounting firm to serve as the Arbitrator, each shall select, by not later than the seventh day following the Pro Forma EBIT objection period, an accounting firm, and each selected accounting firm shall be instructed to jointly select promptly another accounting firm, such third accounting firm shall serve as the Arbitrator. The Arbitrator shall consider only the disputed matters pertaining to the determination and shall act promptly and fairly to resolve all disputed matters and their decision with respect to all disputed matters shall be final and binding upon Seller and Purchaser. The expenses of the arbitration (including reasonable attorney and accounting fees) shall be borne one-half by Purchaser and one-half by Seller. Any net reduction in the Purchase Price as a result of said adjustments shall be made in the manner set forth in Section 4.1(c) and shall be reflected by decreasing the face amount of the note set forth Estimated Adjustment not in dispute. The disputed portion shall be resolved in accordance with the provisions of Section 4.2(c3.3(b) and paid as part of any Post-Closing Adjustment to the extent required by Section 3.3(b). 5.2 (b) Within fifteen sixty (1560) days after the ClosingClosing Date, Purchaser, with the assistance and participation of, and in consultation with, Seller shall prepare and deliver to Purchaser Seller a Pro Forma Balance Sheet which final closing statement (the “Post-Closing Statement”) that shall set forth all adjustments to the Purchased AssetsInitial Purchase Price proposed by Purchaser to be required by Section 3.2 not previously effected by the Closing Adjustment (the “Proposed Post-Closing Adjustment”); provided that if any adjustments to be made pursuant to Section 3.2 cannot be made within sixty (60) days after the Closing Date, and the Assumed Liabilities as of Parties agree that additional Post-Closing Statements can be subsequently prepared to address such dateadjustments. The Pro Forma Balance Sheet To the extent applicable, the Post-Closing Statement shall be prepared using the same accounting methodsprinciples, policies, practices policies and procedures, with consistent classifications, judgments, estimations and methodologies methods as the Operating Agent has historically used in connection with the preparation calculation of the October 31, 1997 Pro Forma Balance Sheet. If the Net Asset Amount (as defined below) shown items reflected on the Pro Forma Balance Sheet is less than $600,000.00, the Purchase Price to be paid to Seller shall be decreased on a dollarsuch Post-for-dollar basis for such difference by decreasing the face amount of the note as set forth in Section 4.2(c) and if the decrease is in excess of the face amount of the note, such amount equal to the excess shall be paid immediately by Seller to Purchaser by certified or cashier's check on the date of the resolution of this determination. If the Net Asset Amount shown on the Pro Forma Balance Sheet equals or exceeds $600,000,00, Purchaser shall be entitled to such excess. The Net Asset Amount shall mean the total of the Purchased Assets less the total of the Assumed Liabilities, in each case as shown on the Pro Forma Balance Sheet. 5.3 Within forty-five (45) days after the end of the applicable periods set forth in Section 4.1(e), i.e. January 6, 1999, January 6, 2000 and March 5, 2000, Purchaser will deliver to Seller a copy of the report of EBIT prepared by Purchaser for the subject period along with any supporting documentation reasonably requested by SellerClosing Statement. Within thirty (30) days after the delivery of delivery the Post-Closing Statement by Purchaser to Seller of such reportSeller, Seller shall have the right to may object in writing good faith to the results contained Proposed Post-Closing Adjustment in such determinationwriting, stating in reasonable detail its objections thereto. If timely objection is not made by Seller to such determination, such determination shall become final and binding for purposes of this Agreement. If timely objection is made by Seller to Purchaser and Purchaser and Seller are able agree to cooperate to exchange information used to prepare the Post-Closing Statement and information relating thereto. If Seller objects to the Proposed Post-Closing Adjustment, the Parties shall attempt to resolve their differences in writing such dispute by negotiation. If the Parties are unable to resolve such dispute within thirty (30) days following after any objection by Seller, the expiration of Parties shall appoint the thirtyIndependent Accounting Firm, which shall, at Seller’s and Purchaser’s joint expense, review the Proposed Post-day periodClosing Adjustment and determine the appropriate adjustment to the Purchase Price, then such determination shall become final and binding as it relates to this Agreement. If timely objection is made by Seller to Purchaser and Seller and Purchaser are unable to resolve their differences in writing if any, within thirty (30) days following the expiration of the thirty-day period, then all disputed matters pertaining to the report shall be submitted to and reviewed by an Arbitrator (the _Arbitrator_) which shall be an independent accounting firm selected by Purchaser and Seller. If Purchaser and Seller are unable to agree promptly upon an accounting firm to serve as the Arbitrator, each shall select by no later than the thirtieth day following the expiration of the sixty (60) day period, an accounting firm and the two selected accounting firms shall be instructed to select promptly another accounting firm, after such newly selected firm to serve as the Arbitratorappointment. The Arbitrator shall consider only Parties agree to cooperate with the disputed matters pertaining Independent Accounting Firm and provide it with such information as it reasonably requests to the determination and shall act promptly enable it to resolve all disputed matters, and its decision with respect to all disputed matters shall be final and binding upon Seller and Purchaser. The expenses of the arbitration (including reasonable attorney and accounting fees) shall be borne one-half by Seller and one-half by Purchasermake such determination. For purposes of this SectionSection 3.3(b) and wherever the Independent Accounting Firm is retained to resolve a dispute between the Parties, the term _EBIT_ shall mean Independent Accounting Firm may determine the net income before taxes and interest expense issues in dispute following such procedures, consistent with the language of Purchaser's Virginia and West Virginia Service Division. The EBIT shall be determined by the independent accountant regularly retained by the Purchaser in the manner set forth above in accordance with generally accepted accounting principlesthis Agreement, subject to verification as described below. For purposes of determining the EBIT for any particular year, except as noted above, no item of income or expense will be allocated by Purchaser to Purchaser's Virginia/West Virginia Service Division unless such items are reasonably calculated to contribute it deems appropriate to the increased profits of such Divisioncircumstances and with reference to the amounts in issue. No particular procedures are intended to be imposed upon the Independent Accounting Firm, it being the intent desire of the parties Parties that Purchaser any such disagreement shall exercise the utmost good faith with respect to allocations of income be resolved as expeditiously and expense to Purchaser's Virginia/West Virginia Service Divisioninexpensively as reasonably practicable. Incident The Independent Accounting Firm shall have no liability to the Parties in connection with such services except for acts of bad faith, willful misconduct or gross negligence, and the Parties shall provide such indemnities to the Independent Accounting Firm as it may reasonably request. The finding of such Independent Accounting Firm shall be binding on the Parties hereto. Upon determination of EBIT the appropriate adjustment (the “Post-Closing Adjustment”) by agreement of Purchaser's Virginia/West Virginia Service Division, no compensation of any executive the Parties or other employee of Purchaser or its affiliates who does not work directly for Purchaser's Virginia/West Virginia Service Division shall be allocated to such Division. In making the by binding determination of EBIT for the Purchaser's Virginia/West Virginia Service Division for calendar year 1 following Independent Accounting Firm, the ClosingParty owing the difference shall deliver such amount to the other Party no later than three (3) Business Days after such determination, a one and one-half percent (1.5%) MAS royalty fee on gross sales in immediately available funds or in any other manner as reasonably requested by the Purchaser's Virginia/West Virginia Service Division shall be made incident to said determination. A MAS royalty fee is a fee charged to each branch of the Purchaser for the following services performed by Purchaser's corporate headquarters: marketing, advertising, professional, accounting and other related expenses. For each subsequent year described above in this paragraph, the parties shall, in good faith, agree upon an MAS royalty fee to be charged hereunder based on the level of services and support being provided by the Purchaser to its Virginia/West Virginia Service Division. Provided, however, such MAS royalty fee shall be 1.5% if the parties are unable to come to an agreement for each subsequent year. For purposes of this Section, the term _Virginia/West Virginia Service Division_ shall be the Business acquired from Seller. Purchaser's contract with the State of West Virginia relating to computer hardware and software and services for educational purposes for K through 12 shall not be included as part of the Virginia/West Virginia Service Divisionpayee.

PRE-CLOSING AND POST-CLOSING ADJUSTMENTS. 5.1 Upon (a) At least thirty (30) calendar days prior to the issuance of Closing Date, Purchaser, with the audited financial statements by Seller's accountantassistance and participation of, Xxxxxx & Xxxxxxand in consultation with, P.C.the Seller and the Operating Agent, Seller will shall prepare and deliver to Purchaser a determination Seller an estimated closing statement (the "ESTIMATED CLOSING STATEMENT") that shall set forth Purchaser's best estimate of Company's Pro Forma EBIT prepared all estimated adjustments to the Initial Purchase Price required by Company's accountant for Section 3.2 (the subject period along with any supporting documentation reasonably requested by Purchaser"ESTIMATED ADJUSTMENT"). Within ten (10) calendar days following after the delivery to Purchaser of such report and prior to Closing, Purchaser shall have the right to object in writing to the results contained in such determination. If timely objection is not made by Purchaser of such determination, such determination shall become final and binding. If timely objection is made Estimated Closing Statement by Purchaser to Seller, and Purchaser and Seller are able may object in good faith to the Estimated Adjustment in writing. If Seller objects to the Estimated Adjustment within such ten (10) day period, the Parties shall attempt to resolve their differences in writing within five (5) days following the expiration of the Pro Forma EBIT objection period, then such determination as resolved shall become final and binding as it relates to this Agreementby negotiation. If timely objection is made by Purchaser to Seller, and Seller and Purchaser the Parties are unable to resolve their differences in writing within five (5) days following the expiration of the Pro Forma EBIT objection period, then all disputed matters relating do so prior to the report Closing Date (or if Seller does not object to the Estimated Adjustment), the Initial Purchase Price shall be submitted to and reviewed by an arbitrator adjusted (the _Arbitrator_"CLOSING ADJUSTMENT") which shall be an independent accounting firm selected at the Closing by Seller and Purchaser. If Purchaser and Seller are unable to agree promptly on the accounting firm to serve as the Arbitrator, each shall select, by not later than the seventh day following the Pro Forma EBIT objection period, an accounting firm, and each selected accounting firm shall be instructed to jointly select promptly another accounting firm, such third accounting firm shall serve as the Arbitrator. The Arbitrator shall consider only the disputed matters pertaining to the determination and shall act promptly and fairly to resolve all disputed matters and their decision with respect to all disputed matters shall be final and binding upon Seller and Purchaser. The expenses of the arbitration (including reasonable attorney and accounting fees) shall be borne one-half by Purchaser and one-half by Seller. Any net reduction in the Purchase Price as a result of said adjustments shall be made in the manner set forth in Section 4.1(c) and shall be reflected by decreasing the face amount of the note set forth Estimated Adjustment not in dispute. The disputed portion shall be resolved in accordance with the provisions of Section 4.2(c3.3(b) and paid as part of any Post-Closing Adjustment to the extent required by Section 3.3(b). 5.2 (b) Within fifteen sixty (1560) days after the ClosingClosing Date, Purchaser, with the assistance and participation of, and in consultation with, the Seller and the Operating Agent, shall prepare and deliver to Purchaser Seller a Pro Forma Balance Sheet which final closing statement (the "POST-CLOSING STATEMENT") that shall set forth all adjustments to the Purchased AssetsInitial Purchase Price proposed by Purchaser to be required by Section 3.2 not previously effected by the Closing Adjustment (the "PROPOSED POST-CLOSING ADJUSTMENT"). To the extent applicable, and the Assumed Liabilities as of such date. The Pro Forma Balance Sheet Post-Closing Statement shall be prepared using the same accounting methodsprinciples, policies, practices policies and procedures, with consistent classifications, judgments, estimations and methodologies methods as the Operating Agent has historically used in connection with the preparation calculation of the October 31, 1997 Pro Forma Balance Sheet. If the Net Asset Amount (as defined below) shown items reflected on the Pro Forma Balance Sheet is less than $600,000.00, the Purchase Price to be paid to Seller shall be decreased on a dollarsuch Post-for-dollar basis for such difference by decreasing the face amount of the note as set forth in Section 4.2(c) and if the decrease is in excess of the face amount of the note, such amount equal to the excess shall be paid immediately by Seller to Purchaser by certified or cashier's check on the date of the resolution of this determination. If the Net Asset Amount shown on the Pro Forma Balance Sheet equals or exceeds $600,000,00, Purchaser shall be entitled to such excess. The Net Asset Amount shall mean the total of the Purchased Assets less the total of the Assumed Liabilities, in each case as shown on the Pro Forma Balance Sheet. 5.3 Within forty-five (45) days after the end of the applicable periods set forth in Section 4.1(e), i.e. January 6, 1999, January 6, 2000 and March 5, 2000, Purchaser will deliver to Seller a copy of the report of EBIT prepared by Purchaser for the subject period along with any supporting documentation reasonably requested by SellerClosing Statement. Within thirty (30) days after the delivery of delivery the Post-Closing Statement by Purchaser to Seller of such reportSeller, Seller shall have the right to may object in writing good faith to the results contained Proposed Post-Closing Adjustment in such determinationwriting, stating in reasonable detail its objections thereto. If timely objection is not made by Seller to such determination, such determination shall become final and binding for purposes of this Agreement. If timely objection is made by Seller to Purchaser and Purchaser and Seller are able agree to cooperate to exchange information used to prepare the Post-Closing Statement and information relating thereto. If Seller objects to the Proposed Post-Closing Adjustment, the Parties shall attempt to resolve their differences in writing such dispute by negotiation. If the Parties are unable to resolve such dispute within thirty (30) days following after any objection by Seller, the expiration of Parties shall appoint the thirtyIndependent Accounting Firm, which shall, at Seller's and Purchaser's joint expense, review the Proposed Post-day periodClosing Adjustment and determine the appropriate adjustment to the Purchase Price, then such determination shall become final and binding as it relates to this Agreement. If timely objection is made by Seller to Purchaser and Seller and Purchaser are unable to resolve their differences in writing if any, within thirty (30) days following the expiration of the thirty-day period, then all disputed matters pertaining to the report shall be submitted to and reviewed by an Arbitrator (the _Arbitrator_) which shall be an independent accounting firm selected by Purchaser and Seller. If Purchaser and Seller are unable to agree promptly upon an accounting firm to serve as the Arbitrator, each shall select by no later than the thirtieth day following the expiration of the sixty (60) day period, an accounting firm and the two selected accounting firms shall be instructed to select promptly another accounting firm, after such newly selected firm to serve as the Arbitratorappointment. The Arbitrator shall consider only Parties agree to cooperate with the disputed matters pertaining Independent Accounting Firm and provide it with such information as it reasonably requests to the determination and shall act promptly enable it to resolve all disputed matters, and its decision with respect to all disputed matters shall be final and binding upon Seller and Purchaser. The expenses of the arbitration (including reasonable attorney and accounting fees) shall be borne one-half by Seller and one-half by Purchasermake such determination. For purposes of this SectionSection and wherever the Independent Accounting Firm is retained to resolve a dispute between the Parties, the term _EBIT_ shall mean Independent Accounting Firm may determine the net income before taxes and interest expense issues in dispute following such procedures, consistent with the language of Purchaser's Virginia and West Virginia Service Division. The EBIT shall be determined by the independent accountant regularly retained by the Purchaser in the manner set forth above in accordance with generally accepted accounting principlesthis Agreement, subject to verification as described below. For purposes of determining the EBIT for any particular year, except as noted above, no item of income or expense will be allocated by Purchaser to Purchaser's Virginia/West Virginia Service Division unless such items are reasonably calculated to contribute it deems appropriate to the increased profits of such Divisioncircumstances and with reference to the amounts in issue. No particular procedures are intended to be imposed upon the Independent Accounting Firm, it being the intent desire of the parties Parties that Purchaser any such disagreement shall exercise the utmost good faith with respect to allocations of income be resolved as expeditiously and expense to Purchaser's Virginia/West Virginia Service Divisioninexpensively as reasonably practicable. Incident The Independent Accounting Firm shall have no liability to the Parties in connection with such services except for acts of bad faith, willful misconduct or gross negligence, and the Parties shall provide such indemnities to the Independent Accounting Firm as it may reasonably request. The finding of such Independent Accounting Firm shall be binding on the Parties hereto. Upon determination of EBIT the appropriate adjustment (the "POST-CLOSING ADJUSTMENT") by agreement of Purchaser's Virginia/West Virginia Service Division, no compensation of any executive the Parties or other employee of Purchaser or its affiliates who does not work directly for Purchaser's Virginia/West Virginia Service Division shall be allocated to such Division. In making the by binding determination of EBIT for the Purchaser's Virginia/West Virginia Service Division for calendar year 1 following Independent Accounting Firm, the ClosingParty owing the difference shall deliver such amount to the other Party no later than two (2) Business Days after such determination, a one and one-half percent (1.5%) MAS royalty fee on gross sales in immediately available funds or in any other manner as reasonably requested by the Purchaser's Virginia/West Virginia Service Division shall be made incident to said determination. A MAS royalty fee is a fee charged to each branch of the Purchaser for the following services performed by Purchaser's corporate headquarters: marketing, advertising, professional, accounting and other related expenses. For each subsequent year described above in this paragraph, the parties shall, in good faith, agree upon an MAS royalty fee to be charged hereunder based on the level of services and support being provided by the Purchaser to its Virginia/West Virginia Service Division. Provided, however, such MAS royalty fee shall be 1.5% if the parties are unable to come to an agreement for each subsequent year. For purposes of this Section, the term _Virginia/West Virginia Service Division_ shall be the Business acquired from Seller. Purchaser's contract with the State of West Virginia relating to computer hardware and software and services for educational purposes for K through 12 shall not be included as part of the Virginia/West Virginia Service Divisionpayee.