Rule 3-14 Compliance Sample Clauses
The Rule 3-14 Compliance clause requires parties to ensure that financial statements or disclosures meet the standards set by Rule 3-14 of Regulation S-X, which typically applies to real estate operations acquired or to be acquired. In practice, this means the seller must provide the buyer with financial information for the property that is sufficient for the buyer to comply with SEC reporting requirements, such as audited income statements for a specified period. This clause is essential for facilitating regulatory compliance in transactions involving publicly traded companies, helping to ensure that all necessary financial data is available for timely and accurate SEC filings.
Rule 3-14 Compliance. Seller shall on or up to forty-five days after Closing provide to Purchaser (at Purchaser’s expense) copies of, or shall provide Purchaser reasonable access to, such factual information as may be reasonably requested by Purchaser, and in the possession or control of Seller, or its property manager or accountants, necessary to enable Purchaser's auditor to conduct an audit, in accordance with Rule 3-14 of Securities and Exchange Commission Regulation S-X, of the income statements of the Property for the year to date of the year in which Closing occurs plus the one (1) immediately preceding calendar year. Purchaser shall be responsible for all out-of-pocket costs associated with this audit. Seller shall up to forty-five days after the Closing reasonably cooperate (at no cost to Seller) with Purchaser’s auditor in the conduct of such audit, EAST\116250601.1 31 which will include responding to verbal requests for information regarding internal controls and follow-up questions on the financial information provided to the Purchaser. In addition, on or up to forty-five days after Closing, Seller agrees to provide to Purchaser or any affiliate of Purchaser, if requested by such auditor, historical financial statements for the Property, including (without limitation) income and balance sheet data for the Property. Without limiting the foregoing, (i) Purchaser or its designated independent or other auditor may audit Seller’s operating statements of the Property, at Purchaser’s expense, and Seller shall on or within forty-five (45) days of Closing provide such documentation as Purchaser or its auditor may reasonably request in order to complete such audit, and (ii) Seller shall on or before Closing furnish to Purchaser such financial and other information as may be reasonably required by Purchaser or any affiliate of Purchaser to make any required filings with the Securities and Exchange Commission or other governmental authority. Seller shall maintain its records for use under this Section 21 for a period of not less than ninety (90) days after the Closing Date. The provisions of this Section shall survive Closing for a period of ninety (90) days. Seller’s obligation to deliver to Purchaser its records for use under this Section 21 shall be an on-going condition to Closing for Purchaser’s benefit until Closing. EAST\116250601.1 32
Rule 3-14 Compliance. Seller shall provide to Purchaser (at Purchaser’s expense) copies of, or shall provide Purchaser reasonable access to, such factual information as may be reasonably requested by Purchaser, and in the possession of Seller, or its property manager or accountants, necessary to enable Purchaser's auditor to conduct an audit, in accordance with Rule 3-14 of Securities and Exchange Commission Regulation S-X, of the income statements of the Property for the year to date of the year in which Closing occurs plus the one (1) immediately preceding calendar year. Purchaser shall be responsible for all out-of-pocket costs, including reasonable attorney fees, associated with this audit. Seller shall reasonably cooperate (at no cost or expense to Seller) with Purchaser’s auditor in the conduct of such audit, which will include verbal requests for information regarding internal controls and follow-up questions on the financial information provided to the Purchaser. In addition, Seller agrees to provide to Purchaser, if requested by such auditor, historical financial statements for the Property to the extent in Seller’s possession, including (without limitation) income and balance sheet data for the Property, whether required before or after Closing. Without limiting the foregoing, (i) Purchaser or its designated independent or other auditor may audit Seller’s operating statements of the Property, at Purchaser’s sole cost and expense, and Seller shall provide such documentation to the extent in Seller’s possession as Purchaser or its auditor may reasonably request in order to complete such audit, and (ii) Seller shall furnish to Purchaser such financial and other information to the extent in Seller’s possession as may be reasonably required by Purchaser or any affiliate of Purchaser to make any required filings with the Securities and Exchange Commission or other governmental authority. Seller’s obligation to maintain its records for use under this Section 11.23 shall be an on-going condition to Closing for Purchaser’s benefit until Closing. Seller shall maintain its records for use under this Section 11.23 for a period of not less than two (2) years after the Closing Date. The provisions of this Section shall survive Closing for a period of two (2) years.
Rule 3-14 Compliance. Seller shall on or up to forty-five (45) days after Closing provide to Purchaser (at Purchaser’s expense) copies of, or shall provide Purchaser reasonable access to, such factual information as may be reasonably requested by Purchaser, and in the possession or control of Seller, or its property manager or accountants, necessary to enable Purchaser's auditor to conduct an audit, in accordance with Rule 3-14 of Securities and Exchange Commission Regulation S-X, of the income statements of the Property for the year to date of the year in which Closing occurs plus the one immediately preceding calendar year. Purchaser shall be responsible for all out-of-pocket costs associated with this audit and the reasonable costs of all personnel required to participate in this audit. Seller shall up to forty-five days after the Closing reasonably cooperate (at no cost to Seller) with Purchaser’s auditor in the conduct of such audit, which will include responding to verbal requests for information regarding internal controls and follow-up questions on the financial information provided to the Purchaser. Seller shall maintain its records for use under this Paragraph 8.23 for a period of not less than ninety days after the Closing Date. The provisions of this Section shall survive Closing for a period of ninety (90) days.