Common use of Working Capital Statement Clause in Contracts

Working Capital Statement. 6.1.1 The Sellers shall prepare in consultation with the Buyer, and deliver to the Buyer, not more than 5 Business Days after the date of this Agreement (or such other period as the Buyer and the Sellers may agree in writing), a statement (the Pre-Closing Working Capital Statement) setting forth their good faith estimated calculation of the Working Capital Amount as of First Completion, which shall be prepared in accordance with US GAAP and include reasonable support for the calculations made therein. 6.1.2 The Buyer shall prepare in consultation with the Sellers and Sellers’ registered accountant and Buyer’s certified public accountant, and deliver to the Sellers, not more than 60 Business Days after Second Completion, a statement (the Post-Closing Working Capital Statement) setting forth their good faith final calculation of the Working Capital Amount as of First Completion , which shall be prepared in accordance with US GAAP and include reasonable support for the calculations made therein. The Pre-Closing Working Capital Statement and the Post-Closing Working Capital Statements are together the Working Capital Statements. 6.1.3 The Sellers or the Buyer, as applicable, shall further deliver together with the applicable draft Working Capital Statement such additional documentation, background notes and working papers as either party may reasonably require in order to review the Working Capital Statements. 6.1.4 The Working Capital Statements shall each be prepared as if the Company had remained under the ownership of the Sellers and shall include any flow of funds which will occur at First Completion or Second Completion in connection with this Agreement but shall exclude the Tax effects or consequences (including any Tax, or withholdings of or on account of Tax) of or relating to: (a) the conversion of any of the Loan Notes and/or the acquisition hereunder of any of the Loan Notes and/or the issue of any of the Converted Shares in connection with such conversion; (b) the actual or deemed repayment, interest payment, release or waiver in whole or in part for Tax or accounting purposes of or in respect of any of the Loan Notes (or the loans to which they relate) as a result of the matters referred to at paragraph (a) above; (c) the ETV Agreement; (d) the Fees Agreement;

Working Capital Statement. 6.1.1 The Sellers shall prepare in consultation with Within five (5) Business Days before the Buyerscheduled Closing Date, Company will prepare, or cause to be prepared, and deliver to the Buyer, not more than 5 Business Days after the date of this Agreement (or such other period as the Buyer and the Sellers may agree in writing), a Parent an unaudited statement (the “Pre-Closing Working Capital Statement) setting forth their good faith estimated calculation of the Working Capital Amount as of First Completion”), which shall be prepared in accordance with US GAAP and include reasonable support for set forth the calculations made therein. 6.1.2 The Buyer shall prepare in consultation with Company’s calculation of Working Capital as of the Sellers and Sellers’ registered accountant and Buyer’s certified public accountant, and deliver to the Sellers, not more than 60 date five (5) Business Days after Second Completion, a statement before the scheduled Closing Date (the Post“Pre-Closing Working Capital Statement) setting forth their good faith final calculation of the Working Capital Amount as of First Completion , which shall be prepared in accordance with US GAAP and include reasonable support for the calculations made thereinCapital”). The Pre-Closing Working Capital Statement shall be prepared in accordance with GAAP applied on a basis consistent with Company’s preparation of its consolidated balance sheet and in accordance with the Postformula set forth on Schedule 4 attached hereto. Upon receipt from the Company, Parent shall have two (2) Business Days to review the Pre-Closing Working Capital Statements are together Statement (the “Review Period”). If Parent disagrees with Company’s computation of the Pre-Closing Working Capital Statements. 6.1.3 The Sellers Capital, Parent may, on or prior to the Buyerlast day of the Review Period, as applicabledeliver a notice to Company (the “Notice of Objection”), which sets forth its objections to Company’s calculation of Pre-Closing Working Capital; provided, however, that the Notice of Objection shall further deliver together include only objections based on (i) non-compliance with the applicable draft standards set forth in Schedule 4 or in this Section 6.17 for the preparation of the Pre-Closing Working Capital Statement and (ii) mathematical errors in the computation of the Pre-Closing Working Capital. Any Notice of Objection shall specify those items or amounts with which Parent disagrees, together with a detailed written explanation of the reasons for disagreement with each such additional documentationitem or amount, background notes and working papers as either party may reasonably require shall set forth Parent’s calculation of the Pre-Closing Working Capital based on such objections. To the extent not set forth in the Notice of Objection, Parent shall be deemed to have agreed with Company’s calculation of all other items and amounts contained in the Pre-Closing Working Capital Statement. Unless Parent delivers the Notice of Objection to Company within the Review Period, Parent shall be deemed to have accepted Company’s calculation of Pre-Closing Working Capital and the Pre-Closing Working Capital Statement shall be final, conclusive and binding. If the Parent delivers the Notice of Objection to the Company within the Review Period, the Parent and the Company shall, during the two (2) days following such delivery or any mutually agreed extension thereof, use their commercially reasonable efforts in good faith to reach agreement on the disputed items and amounts in order to review determine the amount of Pre-Closing Working Capital. In the event of any unresolved, good faith dispute, then the Parent and the Company shall split the difference equally and reduce the Pre-Closing Working Capital Statements. 6.1.4 The by 50% of the total disputed amount; provided, however, if such disputed amount equals or exceeds $250,000 and the parties are unable to resolve the dispute, then the parties agree to extend the Closing Date for a period of thirty (30) days and submit the calculation of the Pre-Closing Working Capital Statements to a mutually agreeable independent public accounting firm (the “Independent Accountants”) for resolution applying the principles, policies and practices referred to in this Section 6.17 and Schedule 4. If issues are submitted to the Independent Accountants for resolution, Parent and the Company shall furnish or cause to be furnished to the Independent Accountants such work papers and other documents and information relating to the disputed issues as the Independent Accountants may request and are available to that party or its agents and shall be afforded the opportunity to present to the Independent Accountants any material relating to the disputed issues and to discuss the issues with the Independent Accountants. The determination by the Independent Accountants, as set forth in a notice to be delivered to both Parent and the Company within fifteen (15) Business Days of the submission to the Independent Accountants of the issues remaining in dispute, shall be final, binding and conclusive on the parties and shall be used in the calculation of the Final Working Capital. Parent and the Company will each be prepared bear fifty percent (50%) of the fees and costs of the Independent Accountants for such determination. “Final Working Capital” means the Pre-Closing Working Capital (i) as shown in the Pre-Closing Working Capital Statement delivered by Company to Parent pursuant to this Section 6.17, if no Notice of Objection with respect thereto is timely delivered by Parent to the Company; or (ii) if a Notice of Objection is so delivered, (A) as agreed by the Parent and Company pursuant to this Section 6.17, or (B) in the absence of such agreement, (I) as calculated in accordance with this Section 6.17 if the Company had remained under the ownership of the Sellers and shall include any flow of funds which will occur at First Completion or Second Completion in connection with this Agreement but shall exclude the Tax effects or consequences (including any Taxdisputed amount is less than $250,000, or withholdings of or on account of Tax) of or relating to: (a) the conversion of any of the Loan Notes and/or the acquisition hereunder of any of the Loan Notes and/or the issue of any of the Converted Shares in connection with such conversion; (b) the actual or deemed repayment, interest payment, release or waiver in whole or in part for Tax or accounting purposes of or in respect of any of the Loan Notes (or the loans to which they relateII) as a result of determined by the matters referred Independent Accountants, if the disputed amount is equal to at paragraph (a) above; (c) the ETV Agreement; (d) the Fees Agreement;or greater than $250,000.

Working Capital Statement. 6.1.1 The Sellers Within forty-five (45) calendar days after the Closing Date, the Buyer shall prepare in consultation with the Buyer, and deliver to the BuyerSellers a Statement (the "Working Capital Statement") which shall set forth the following information: (i) the Accounts Receivable as of the Closing Date, not more than 5 Business Days after determined in accordance with GAAP, (ii) the date accounts payable as of the Closing Date, adjusted to eliminate any direct mailing expenses assumed by the Buyer pursuant to Section 2.4 hereof, determined in accordance with GAAP (the "Closing Date Accounts Payable") and (iii) a calculation of the Accounts Receivable less the Closing Date Accounts Payable (the "Net Working Capital"). During the period of any dispute with respect to the application of this Agreement Section 3.3, the Buyer shall provide the Sellers full access to the books, records, facilities and employees of the Business, and shall cooperate with the Sellers to the extent reasonably requested by the Sellers to investigate the basis for such dispute. Not later than forty-five (or such other period as 45) calendar days after receipt of the Working Capital Statement, the Sellers shall provide the Buyer with a list of those items, if any, to which the Sellers take exception and the Sellers' proposed adjustment (the "Working Capital Statement Report"). If the Sellers fail to deliver to the Buyer the Working Capital Statement Report within forty-five (45) calendar days following receipt of the Working Capital Statement, the Sellers shall be deemed to have accepted the Working Capital Statement for the purposes of any Purchase Price adjustment under Section 3.3(b) hereof. If the Buyer does not give the Sellers notice of objections within thirty (30) calendar days following receipt of the Working Capital Statement Report, the Buyer shall be deemed to have accepted the Working Capital Statement Report for the purposes of any Purchase Price adjustment under Section 3.3(b) hereof. If the Buyer gives the Sellers notice of objections to the Working Capital Statement Report, and if the Buyer and the Sellers may agree in writing)are unable, a statement within fifteen (15) calendar days after receipt by the Pre-Closing Working Capital Statement) setting forth their good faith estimated calculation Sellers of the Working Capital Amount as notice by the Buyer of First Completionobjections, which shall to resolve the disputed exceptions, such disputed exceptions will be prepared in accordance with US GAAP and include reasonable support for the calculations made therein. 6.1.2 The Buyer shall prepare in consultation with the Sellers and Sellers’ registered accountant and Buyer’s referred to a firm of independent certified public accountantaccountants ("Independent Accounting Firm") mutually acceptable to the Buyer and the Sellers. The Independent Accounting Firm shall, and within sixty (60) days following its selection, deliver to the SellersBuyer and the Sellers a written report determining such disputed exceptions, not more than 60 Business Days after Second Completion, a statement (and its determinations will be conclusive and binding upon the Post-Closing Working Capital Statementparties thereto for the purposes of any Purchase Price adjustment under Section 3.3(b) setting forth their good faith final calculation hereof. The fees and disbursements of the Working Capital Amount as of First Completion , which Independent Accounting Firm acting under this Section shall be prepared in accordance with US GAAP and include reasonable support for shared equally by the calculations made therein. The Pre-Closing Working Capital Statement Buyer and the Post-Closing Working Capital Statements are together the Working Capital StatementsSellers. 6.1.3 The Sellers or the Buyer, as applicable, shall further deliver together with the applicable draft Working Capital Statement such additional documentation, background notes and working papers as either party may reasonably require in order to review the Working Capital Statements. 6.1.4 The Working Capital Statements shall each be prepared as if the Company had remained under the ownership of the Sellers and shall include any flow of funds which will occur at First Completion or Second Completion in connection with this Agreement but shall exclude the Tax effects or consequences (including any Tax, or withholdings of or on account of Tax) of or relating to: (a) the conversion of any of the Loan Notes and/or the acquisition hereunder of any of the Loan Notes and/or the issue of any of the Converted Shares in connection with such conversion; (b) the actual or deemed repayment, interest payment, release or waiver in whole or in part for Tax or accounting purposes of or in respect of any of the Loan Notes (or the loans to which they relate) as a result of the matters referred to at paragraph (a) above; (c) the ETV Agreement; (d) the Fees Agreement;

Working Capital Statement. 6.1.1 The Sellers shall (a) As promptly as practicable and in any event within 90 days after the Closing Date, Seller will prepare in consultation with the Buyer, and deliver to Acquiror a consolidated balance sheet of the BuyerCompany as of the Closing Date prepared in accordance with GAAP (except that any liability for Taxes which are the responsibility of Seller pursuant to Section 9.1(a) shall be eliminated therefrom) (the "CLOSING DATE BALANCE SHEET"), not and a certificate of Seller (the "WORKING CAPITAL STATEMENT") based on the Closing Date Balance Sheet setting forth Seller's calculation of the Working Capital. Seller will afford one or more than 5 Business Days after representatives of Acquiror (including its auditors) the date opportunity to review Seller's preparation of this Agreement (or such other period as the Buyer Closing Date Balance Sheet and the Sellers may agree in writing), a statement (the Pre-Closing Working Capital Statement) setting forth their good faith estimated , including, without limitation, the opportunity to observe any physical inventory count and other accounting procedures. If Acquiror and Seller agree upon the accuracy of the Closing Date Balance Sheet and the calculation of the Working Capital Amount as within 90 days after the delivery to Acquiror of First Completion, which shall be prepared in accordance with US GAAP the Closing Date Balance Sheet and include reasonable support for the calculations made therein. 6.1.2 The Buyer shall prepare in consultation with the Sellers and Sellers’ registered accountant and Buyer’s certified public accountant, and deliver to the Sellers, not more than 60 Business Days after Second Completion, a statement (the Post-Closing Working Capital Statement, Sections 2.4(b) setting forth their good faith final and 2.4(c) will not apply; however, if Acquiror and Seller do not so agree, then Sections 2.4(b) and 2.4(c) will apply. (b) If Acquiror disputes the accuracy of the Closing Date Balance Sheet or otherwise disagrees with Seller's calculation of the Working Capital Amount as Capital, Acquiror may, within 90 days (the "OBJECTION PERIOD") after the delivery to Acquiror of First Completion , which shall be prepared in accordance with US GAAP the Closing Date Balance Sheet and include reasonable support for the calculations made therein. The Pre-Closing Working Capital Statement Statement, deliver a notice (the "OBJECTION NOTICE") to Seller disputing the accuracy of the Closing Date Balance Sheet and the Post-Closing Working Capital Statements are together the Working Capital Statements. 6.1.3 The Sellers or the Buyer, as applicable, shall further deliver together with the applicable draft Working Capital Statement such additional documentation, background notes and working papers as either party may reasonably require in order to review the Working Capital Statements. 6.1.4 The Working Capital Statements shall each be prepared as if the Company had remained under the ownership calculation of the Sellers and shall include any flow of funds which will occur at First Completion or Second Completion in connection with this Agreement but shall exclude the Tax effects or consequences (including any Tax, or withholdings of or on account of Tax) of or relating to: (a) the conversion of any of the Loan Notes and/or the acquisition hereunder of any of the Loan Notes and/or the issue of any of the Converted Shares in connection with such conversion; (b) the actual or deemed repayment, interest payment, release or waiver in whole or in part for Tax or accounting purposes of or in respect of any of the Loan Notes (or the loans to which they relate) as a result of the matters referred to at paragraph (a) above; (c) the ETV Agreement; (d) the Fees Agreement;the