Common use of Adjustment to Purchase Price Clause in Contracts

Adjustment to Purchase Price. In the event the Final Statement ---------------------------- reflects an increase in the actual cost of the Inventory, the aggregate Book Value of the Fixed Assets, the amount paid in Paid Time Off or the Advertising Allowance, the Purchase Price shall be adjusted upward (i) on a dollar for dollar basis for any increase in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and (ii) one dollar for every two dollar increase in Advertising Allowance. In the event that the Final Statement reflects a decrease in the actual cost of the Inventory, the aggregate Book Value of the Fixed Assets, the amount paid in Paid Time Off or the Advertising Allowance, the Purchase Price shall be adjusted downward (i) on a dollar for dollar basis for any decrease in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and (ii) one dollar for every two dollar decrease in Advertising Allowance. If such adjustments result in a balance due the Sellers (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement), the Buyer shall pay such balance to the Parent within fifteen days after the date of determination of the Final Statement; provided, however, that in no event shall -------- ------- the Buyer be obligated to pay in the aggregate more than One Hundred Fifty Thousand Dollars ($150,000) for any Purchase Price adjustments resulting from an increase in the aggregate Book Value as of July 31, 1996, of the Fixed Assets transferred on the Closing Date. If such adjustment results in a balance due the Buyer (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement), the Sellers shall pay such balance to the Buyer within fifteen (15) days after the date of determination of the Final Statement.

Adjustment to Purchase Price. In The Purchase Price will be increased or decreased, as the event case may be, dollar for dollar, to the Final Statement ---------------------------- reflects an increase extent that the value of the Net Tangible Assets of Seller as reflected on the Closing Balance Sheet is greater or less than zero (the "Purchase Price Adjustment"). The Closing Balance Sheet shall be a balance sheet of the Seller comprised of the Acquired Assets and Assumed Liabilities (provided, however, that no value shall be assigned to the Intellectual Property included in the actual cost Acquired Assets or the deferred revenue included in the Assumed Liabilities) as of the InventoryClosing Date, prepared by the aggregate Book Value Buyer, in the form and incorporating the adjustments set forth on Schedule 1.3 hereto. The Buyer shall send a copy of the Fixed AssetsClosing Balance Sheet to the Seller within forty-five (45) days following the Closing Date, (the date of such notice being sometimes referred to herein as the "Purchase Price Adjustment Date") together with a notice setting forth (a) the amount paid of the adjustment in Paid Time Off or the Advertising Allowance, the Purchase Price shall be adjusted upward (i) on a dollar for dollar basis for any increase in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and (iib) one dollar for every two dollar increase in Advertising Allowancea list of any assets and liabilities rejected by Buyer pursuant to Section 1.1 hereof (the "Purchase Price Adjustment Notice"). In the event that the Final Statement reflects a decrease Purchase Price Adjustment Notice sets forth an increase in the actual cost of the Inventory, the aggregate Book Value of the Fixed Assets, the amount paid in Paid Time Off or the Advertising Allowance, the Purchase Price shall be adjusted downward (i) on a dollar for dollar basis for any decrease in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and (ii) one dollar for every two dollar decrease in Advertising Allowance. If such adjustments result in a balance due the Sellers (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement)Price, the Buyer shall pay such balance amount to the Parent within fifteen days after the date of determination of the Final Statement; provided, however, that in no event shall -------- ------- the Buyer be obligated to pay in the aggregate more than One Hundred Fifty Thousand Dollars ($150,000) for any Purchase Price adjustments resulting from an increase in the aggregate Book Value as of July 31, 1996, of the Fixed Assets transferred on the Closing Date. If such adjustment results in a balance due the Buyer (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement), the Sellers shall pay such balance to the Buyer Seller within fifteen (15) days after the date of determination of the Final StatementPurchase Price Adjustment Date. In the event that the Purchase Price Adjustment Notice sets forth a decrease in the Purchase Price, the amount of such decrease shall be set-off against the amounts due under the Note, subject to Seller's right to dispute the Purchase Price Adjustment pursuant to Section 7.2 hereof.

Adjustment to Purchase Price. On the date hereof, the Company shall deliver to the Buyer a balance sheet as of August 31, 1998, which has been prepared by the Company and attached hereto as Schedule 2.3 (the "Balance Sheet"). Within ninety (90) days following the Closing Date, Ernst & Young LLP ("E&Y") shall deliver to the Buyer and to the Shareholder Representative (as defined in Section 4 below) an audited balance sheet as of the Closing Date (the "Closing Balance Sheet") showing the Company's Net Asset Value (as defined herein) as of the close of business on the day prior to the Closing Date (the "Closing Balance Sheet Net Asset Value"). The Closing Balance Sheet shall be prepared in accordance with generally accepted accounting principles ("GAAP") consistently applied using the same methodology as was used in the preparation of the Financial Statements (as defined in Section 6.5 hereof) and the Balance Sheet. In the event that the Final Statement ---------------------------- reflects an increase in Closing Balance Sheet Net Asset Value is less than the actual cost of Net Asset Value as shown on the Inventory, Balance Sheet (the aggregate Book Value of the Fixed Assets, the amount paid in Paid Time Off or the Advertising Allowance"Target Net Asset Value"), the Purchase Price shall be adjusted upward (i) on a dollar for dollar basis for any increase in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and (ii) reduced by one dollar for every two each dollar increase in Advertising Allowancethat the Closing Balance Sheet Net Asset Value is less than the Target Net Asset Value. In the event that the Final Statement reflects a decrease in the actual cost amount of the Inventory, Closing Balance Sheet Net Asset Value is more than the aggregate Book Value of the Fixed Assets, the amount paid in Paid Time Off or the Advertising AllowanceTarget Net Asset Value, the Purchase Price shall be adjusted downward (i) on a increased by one dollar for each dollar basis that the Closing Balance Sheet Net Asset Value is more than the Target Net Asset Value (collectively, the "Purchase Price Adjustment"). The Shareholder Representative and the Buyer shall be entitled to review the Closing Balance Sheet for any decrease a period of thirty (30) days after delivery by E&Y. In the event that before the end of such thirty (30) day period, either of such persons notifies the other in writing that they dispute the Closing Balance Sheet Net Asset Value shown on the Closing Balance Sheet, then the Closing Balance Sheet Shareholders' Equity shall be determined by PricewaterhouseCoopers LLP, or other Big 5 accounting firm mutually agreed to by Buyer and the Shareholder Representative ("Second Auditor"), which determination shall be made within thirty (30) days of the date such firm is retained and when delivered shall be final and binding on the parties. If the Closing Balance Sheet Net Asset Value as determined by the Second Auditor varies in favor of the requesting party, the cost of Inventory, Book the Second Auditor shall be paid by the non-requesting party. If the Closing Balance Sheet Net Asset Value as determined by the Second Auditor does not vary in favor of the Fixed Assetsrequesting party, or amount the cost of the Second Auditor shall be paid in Paid Time Off, and (ii) one dollar for every two dollar decrease in Advertising Allowanceby the requesting party. If such adjustments result in neither the Shareholder Representative nor the Buyer notifies the other that it is contesting the Closing Balance Sheet within the above specified time period, the Closing Balance Sheet provided by E&Y shall be final and binding on all parties for purposes of making the above specified Purchase Price Adjustment. When the Purchase Price Adjustment has been finally determined, if a balance due Purchase Price reduction results, the Sellers (after taking into account Buyer shall reduce the Holdback Amount by the amount of the upward or downward adjustment to Purchase Price Adjustment; provided, that, if the Purchase Price made based on Adjustment is greater than the Preliminary Statement)Holdback Amount, the Buyer shall pay such balance to the Parent within fifteen days after the date of determination then each of the Final Statement; provided, however, that in no event Shareholders shall -------- ------- the Buyer be obligated to pay in the aggregate more than One Hundred Fifty Thousand Dollars ($150,000) for any Purchase Price adjustments resulting from an increase in the aggregate Book Value as of July 31, 1996, refund such Shareholder's Prorata Share of the Fixed Assets transferred on the Closing Date. If such adjustment results in a balance due the Buyer (after taking into account the amount of the upward or downward adjustment to by which the Purchase Price made based on Adjustment exceeds the Preliminary Statement), the Sellers shall pay such balance Holdback Amount in cash (or by immediately available funds transfer) to the Buyer within fifteen five (155) days after of the date that the Purchase Price Adjustment is finally determined. If the Purchase Price Adjustment results in a Purchase Price increase, the amount of determination such increase shall be added to the Holdback Amount and shall be paid as provided in Section 3 below. For purposes hereof, "Net Asset Value" shall mean the tangible assets of the Final StatementBusiness less the liabilities of the Business.

Adjustment to Purchase Price. In The Purchase Price will be ------------------------------- adjusted by the event the Final Statement ---------------------------- reflects an increase amount, if any, of any Material Reduction or any Material Increase in the actual cost stated book value of the Inventory, the aggregate Book Value Accounts Receivable, and/or the Equipment at the Closing Date, as reflected in the then current accounting records of the Fixed AssetsSeller. On or immediately prior to the Closing Date, the Buyer will be entitled to review the then current accounting records of the Seller and to undertake a physical inventory of the Business Assets at all locations where Business Assets are located in order to confirm the existence of the Business Assets and the book value of the Inventory, the Accounts Receivable, the Real Property, and the Equipment at such date. If, on the basis of such review and inventory, the Buyer determines that there is a Material Reduction or a Material Increase in the book value of the Inventory, the Accounts Receivable, the Real Property, and/or the Equipment, it will so notify the Seller and the Purchase Price will be reduced or increased by an amount paid in Paid Time Off equal to the Material Reduction or the Advertising AllowanceMaterial Increase, as the case may be; and, in such event, the Closing Payment will be reduced or increased by the amount of the adjustment in the Purchase Price. If the Seller objects to the reduction or increase, if any, determined by the Buyer, then the Seller and the Buyer will attempt to resolve the matter or matters in dispute. If such dispute cannot be resolved by the Seller and the Buyer by the scheduled Closing Date, then the scheduled Closing Date will be postponed by 30 Business Days and, during such period of postponement, the specific matters in dispute will be submitted to an accounting firm as may be approved by the Seller and the Buyer, with the request that such firm render its opinion as to such matters as soon as practicable. Based on such opinion, such accounting firm will be requested to provide its determination on the specific matters in dispute, and such determination will be final and binding on the Seller and the Buyer. Promptly after receipt of the determination of such firm, the Seller and the Buyer shall complete the Closing (subject to the satisfaction of the conditions to Closing set forth in this Agreement) and the Purchase Price shall be adjusted upward (i) on a dollar for dollar basis for any increase in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and (ii) one dollar for every two dollar increase in Advertising Allowance. In the event that the Final Statement reflects a decrease in the actual cost of the Inventory, the aggregate Book Value of the Fixed Assets, the amount paid in Paid Time Off or the Advertising Allowance, the Purchase Price shall be adjusted downward (i) on a dollar for dollar basis for any decrease in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and (ii) one dollar for every two dollar decrease in Advertising Allowance. If such adjustments result in a balance due the Sellers (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement), the Buyer shall pay such balance to the Parent within fifteen days after the date of determination of the Final Statement; providedaccounting firm requested to make such determination. The foregoing notwithstanding, however, that in under no event shall -------- ------- circumstances will the Buyer be obligated to pay a Purchase Price that exceeds $150,000; and in the aggregate more than One Hundred Fifty Thousand Dollars ($150,000) for any Purchase Price adjustments resulting from an increase event of a Material Increase that would result in the aggregate Book Value as of July 31, 1996, of the Fixed Assets transferred on the Closing Date. If such adjustment results in a balance due the Buyer (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement)exceeding $150,000, the Sellers Buyer, at its election, shall be entitled to either pay such balance the Purchase Price, as increased pursuant to the Buyer within fifteen (15) days after the date of determination of the Final Statementthis Section, or to terminate this Agreement without penalty.

Adjustment to Purchase Price. In the event the Final Statement ---------------------------- reflects an increase in the actual cost of the InventoryIf, the aggregate Book Value of Accounts Receivable on the Fixed AssetsClosing Date are less than One Million Dollars ($1,000,000) (such amount, the amount paid in Paid Time Off or the Advertising Allowance“AR Target Amount”), then the Purchase Price shall be adjusted upward (i) on a reduced, dollar for dollar basis for any increase in dollar, by the cost of Inventorydifference between the Accounts Receivable amount on the Closing Date and the AR Target Amount. If, Book Value of on the Fixed Assets, or amount paid in Paid Time Off, and (ii) one dollar for every two dollar increase in Advertising Allowance. In the event that the Final Statement reflects a decrease in the actual cost of the InventoryClosing Date, the aggregate Book Value of Accounts Receivable are more than the Fixed AssetsAR Target Amount, the amount paid in Paid Time Off or the Advertising Allowance, then the Purchase Price to be paid at the Closing shall be adjusted downward (i) on a increased, dollar for dollar basis for any decrease dollar, by the difference between the Accounts Receivable amount on the Closing Date and the AR Target Amount. The adjustment described in this Section 3.2 shall be determined as follows: Within five (5) days after the cost of InventoryClosing Date, Book Value Seller shall provide Buyer with a calculation of the Fixed Assets, or amount paid in Paid Time OffAccounts Receivable as of the Closing Date, and (ii) one dollar for every two dollar decrease in Advertising Allowance. If such adjustments result in a balance due the Sellers (after taking into account the amount of the upward or downward adjustment (the “Proposed Adjustment”). If Buyer agrees to the Purchase Price made based on Proposed Adjustment within 10 days of receipt of such Proposed Adjustment from the Preliminary StatementSeller or does not respond to Seller within such 10 day period, then such Proposed Adjustment shall be deemed the final adjustment (the “Final Adjustment”). The Seller or the Buyer, the Buyer as applicable, shall pay such balance the Final Adjustment to the Parent other party, by wire transfer, in accordance with wire instructions provided by the applicable party, within fifteen five (5) days after the date of determination of the Final Statement; provided, however, that in no event shall -------- ------- Adjustment. If the Buyer be obligated to pay in notifies the aggregate more than One Hundred Fifty Thousand Dollars ($150,000) for any Purchase Price adjustments resulting from an increase in the aggregate Book Value as Seller within 10 days of July 31, 1996, receipt of the Fixed Assets transferred Proposed Adjustment that Buyer disagrees with such Proposed Adjustment, then Buyer and Seller shall work diligently to resolve their differences within the next ten (10) days. If they come to an agreement on the Closing Dateadjustment during such ten (10) day period, their agreement will be deemed the Final Adjustment, and the applicable party shall pay the other party the Final Adjustment amount within five (5) days of determination of such Final Adjustment. If such adjustment results in a balance due the Buyer (after taking into account parties cannot agree on the amount of the upward or downward adjustment to within such ten (10) day period, then the Purchase Price made Final Adjustment shall be determined by three accountants, one appointed by each of Buyer and Seller, and the third appointed by the other two accountants. The accountants will determine the Final Adjustment, based on the Preliminary Statement)terms of this Agreement, the Sellers shall pay such balance to the Buyer within fifteen (15) days after of being appointed, and their decision shall be binding on the date of determination parties. The Buyer and the Seller will each be responsible for paying one half of the Final Statementfees of the accountants.

Adjustment to Purchase Price. In the event the Final Statement ---------------------------- reflects an increase in the actual cost of the Inventory, the aggregate Book Value of the Fixed Assets, the amount paid in Paid Time Off or the Advertising Allowance, the Purchase Price shall be adjusted upward (ia) on a dollar for dollar basis for any increase in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and Within ninety (ii90) one dollar for every two dollar increase in Advertising Allowance. In the event that the Final Statement reflects a decrease in the actual cost of the Inventory, the aggregate Book Value of the Fixed Assets, the amount paid in Paid Time Off or the Advertising Allowance, the Purchase Price shall be adjusted downward (i) on a dollar for dollar basis for any decrease in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and (ii) one dollar for every two dollar decrease in Advertising Allowance. If such adjustments result in a balance due the Sellers (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement), the Buyer shall pay such balance to the Parent within fifteen calendar days after the date of determination Closing Date, a balance sheet of the Final StatementBusiness reflecting the assets and Liabilities of the Business as of the close of business on the date immediately prior to the Closing Date including a calculation of Net Worth will be prepared by Buyer and delivered to Seller. Such balance sheet, as adjusted, is referred to herein as the "Closing Date Balance Sheet." The Closing Date Balance Sheet shall be prepared in a manner consistent with the Reference Date Balance Sheet (including with respect to adjustment procedures, discretionary allocations and other judgments) and shall reflect the consolidation of the assets and Liabilities of Acquired Companies and the Business in accordance with GAAP; provided, however, that in no event that, notwithstanding anything contained on the Reference Date Balance Sheet or herein to the contrary, the Closing Date Balance Sheet (i) shall -------- ------- the Buyer be obligated to pay in the aggregate more than One Hundred Fifty Thousand Dollars ($150,000) for not include any Purchase Price adjustments resulting from an increase in the aggregate Book Value intercompany accounts as of July 31, 1996, between any of the Fixed Assets transferred Acquired Companies, on the Closing Date. If such adjustment results in a balance due one hand, and Parent or any subsidiary or Affiliate of Seller (other than the Buyer Acquired Companies), on the other hand, including, without limitation, the Intergroup Receivables; (after taking into account ii) shall not include any purchase accounting adjustments; (iii) shall not contain any Excluded Liabilities or any Liabilities related to indebtedness (other than capital lease obligations), including, without limitation, the amount Barclays Debt; (iv) shall not include any Liability underlying the obligations of the upward or downward adjustment Acquired Companies with respect to the Purchase Price made based Continued Employee Payment or the Chameleon Payment (it being agreed that such Liabilities and corresponding payments shall be determined and paid pursuant to Section 2.2(c)); (v) shall include only such inventory that is (A) reflected on the Preliminary Statement)Reference Date Balance Sheet or has been manufactured since the Reference Date, and (B) located at the Andover Facility or such other locations designated by Buyer. All foreign currency amounts shall be expressed in United States dollars using the exchange rate and conversion mechanism as required by GAAP; and (vi) shall include as an accrued expense for unpaid Taxes for the 1998 and 1999 Tax years an amount equal to that shown on the Reference Date Balance Sheet for such Tax years (for the avoidance of doubt, it is agreed among the parties that any deficiencies of such accrual shall be resolved on a dollar-for-dollar basis pursuant to the 1998/1999 Tax Make-Whole Payment under Section 2.2(c) or, as necessary, the Sellers indemnification rights under Section 14.3). Parent shall pay have the right to review the computations and work papers (including access to accountants' work papers, subject to such balance confidentiality restrictions and indemnities as Buyer's accountants shall reasonably request) and underlying books and records used in connection with Buyer's preparation of the Closing Date Balance Sheet and to have access to the key employees and independent accountants of Buyer within fifteen (15) days after in connection therewith. Buyer shall maintain separate books and records for the date of determination of Business until such time as any post-Closing adjustment under this Section 2.3 has been paid by the Final Statementrelevant party.

Adjustment to Purchase Price. In the event the Final Statement ---------------------------- reflects an increase in the actual cost (a) The purpose of the Inventorypurchase price adjustment set forth in this Section 2.9 is solely to measure any changes in Cash Equivalents, the aggregate Book Value Net Working Capital, Indebtedness, Capital Expenditure Amount, and Closing Date Seller Expenses of the Fixed Assets, Acquired Companies from the amount paid in Paid Time Off target or the Advertising Allowance, estimated amounts used to determine the Purchase Price as of 11:59 p.m., Miami, Florida time, on the date immediately prior to the Closing Date (the “Calculation Time”) to the actual amounts of Cash Equivalents, Net Working Capital, Indebtedness, Capital Expenditure Amount and Closing Date Seller Expenses of the Acquired Companies as of the Calculation Time (except that (x) Pre-Closing Income Taxes shall be adjusted upward determined as of the end of the day on the Closing Date and (y) such amounts shall be calculated after giving effect to the Reorganization and the Redemptions) on the same accounting basis consistently applied to reflect the transactions or events up to and conditions existing as of the Closing. No later than three Business Days prior to the Closing, Sellers’ Representative shall in accordance with the terms of this Section 2.9, prepare and deliver to Buyer (i) on a dollar for dollar basis for any increase in the cost of Inventory, Book Value an estimated consolidated balance sheet of the Fixed AssetsAcquired Companies as of the Calculation Time (the “Estimated Closing Balance Sheet”), or amount paid which Estimated Closing Balance Sheet shall be calculated after giving effect to the Reorganization and the Redemptions and shall include a good faith estimation of (1) Cash Equivalents (“Estimated Cash Equivalents”), (2) Net Working Capital (“Estimated Net Working Capital”), (3) Indebtedness (“Estimated Indebtedness”) and (4) Capital Expenditure Amount (“Estimated Capital Expenditure Amount”) (such calculation shall be consistent with the format set forth on Schedule 2.9(a)), each of which shall be calculated as of the Calculation Time (except that (x) Pre-Closing Income Taxes shall be determined as of the end of the day on the Closing Date and (y) such amounts shall be calculated after giving effect to the Reorganization and the Redemptions), (ii) Schedule 2.6(b) setting forth the Estimated Closing Date Seller Expenses and Estimated Indebtedness, in Paid Time Offeach case as of the Calculation Time, and wire instructions therefor, and (iii) the resulting good faith calculation of Purchase Price for purposes of Section 2.2 based on the estimates described in clauses (i) and (ii) one dollar for every two dollar increase in Advertising Allowance(collectively, the “Estimated Closing Statement”). In the event that the Final Statement reflects a decrease Sellers’ Representative shall also deliver to Buyer at such time reasonable supporting or underlying documentation used in the actual cost preparation of Estimated Closing Statement. Following the delivery of the InventoryEstimated Closing Statement and prior to the Closing, Buyer shall have the opportunity to review the Estimated Closing Statement and Sellers’ Representative shall provide Buyer and its Representatives with reasonable access to the books and records of the Acquired Companies and other documents reasonably requested by Buyer. Sellers’ Representative shall, and shall cause the Sellers and the Acquired Companies and their respective Representatives, to reasonably cooperate with Buyer in good faith to respond to any questions regarding the Estimated Closing Statement raised by Buyer and shall consider in good faith any comments from Buyer if Buyer disputes any item on the Estimated Closing Statement. If Sellers’ Representative agrees to make any modification to the Estimated Closing Statement requested by Buyer, then the Estimated Closing Statement as so agreed by Sellers’ Representative to be modified shall be deemed to be the Estimated Closing Statement for purposes of this Agreement. The Estimated Closing Statement and the determinations and calculations contained therein will be prepared and calculated in accordance with (x) GAAP, (y) the definitions contained in this Agreement and (z) the accounting principles and methods used in the calculations set forth in Schedule 2.9(b) (collectively, the aggregate Book Value of the Fixed Assetsprinciples described in clauses (x), the amount paid in Paid Time Off or the Advertising Allowance, the Purchase Price shall be adjusted downward (iy) on a dollar for dollar basis for any decrease in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and (ii) one dollar for every two dollar decrease in Advertising Allowance. If such adjustments result in a balance due the Sellers (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statementz), the Buyer shall pay such balance to the Parent within fifteen days after the date of determination of the Final Statement; provided, however, that in no event shall -------- ------- the Buyer be obligated to pay in the aggregate more than One Hundred Fifty Thousand Dollars ($150,000) for any Purchase Price adjustments resulting from an increase in the aggregate Book Value as of July 31, 1996, of the Fixed Assets transferred on the Closing Date. If such adjustment results in a balance due the Buyer (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement“Accounting Principles”), the Sellers shall pay such balance to the Buyer within fifteen (15) days after the date of determination of the Final Statement.

Adjustment to Purchase Price. In The Purchase Price will be increased or decreased, as the event case may be, dollar for dollar, to the Final Statement ---------------------------- reflects an increase extent that the value of the Net Tangible Assets of Seller as reflected on the Closing Balance Sheet is greater or less than zero (the "PURCHASE PRICE ADJUSTMENT"). The Closing Balance Sheet shall be a balance sheet of the Seller comprised of the Acquired Assets and Assumed Liabilities (provided, however, that no value shall be assigned to the Intellectual Property included in the actual cost Acquired Assets or the deferred revenue included in the Assumed Liabilities) as of the InventoryClosing Date, prepared by the aggregate Book Value Buyer, in the form and incorporating the adjustments set forth on Schedule 1.3 hereto. The Buyer shall send a copy of the Fixed AssetsClosing Balance Sheet to the Seller within forty-five (45) days following the Closing Date, (the date of such notice being sometimes referred to herein as the "PURCHASE PRICE ADJUSTMENT DATE") together with a notice setting forth (a) the amount paid of the adjustment in Paid Time Off or the Advertising Allowance, the Purchase Price shall be adjusted upward (i) on a dollar for dollar basis for any increase in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and (iib) one dollar for every two dollar increase in Advertising Allowancea list of any assets and liabilities rejected by Buyer pursuant to Section 1.1 hereof (the "PURCHASE PRICE ADJUSTMENT NOTICE"). In the event that the Final Statement reflects a decrease Purchase Price Adjustment Notice sets forth an increase in the actual cost of the Inventory, the aggregate Book Value of the Fixed Assets, the amount paid in Paid Time Off or the Advertising Allowance, the Purchase Price shall be adjusted downward (i) on a dollar for dollar basis for any decrease in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and (ii) one dollar for every two dollar decrease in Advertising Allowance. If such adjustments result in a balance due the Sellers (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement)Price, the Buyer shall pay such balance amount to the Parent within fifteen days after the date of determination of the Final Statement; provided, however, that in no event shall -------- ------- the Buyer be obligated to pay in the aggregate more than One Hundred Fifty Thousand Dollars ($150,000) for any Purchase Price adjustments resulting from an increase in the aggregate Book Value as of July 31, 1996, of the Fixed Assets transferred on the Closing Date. If such adjustment results in a balance due the Buyer (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement), the Sellers shall pay such balance to the Buyer Seller within fifteen (15) days after the date of determination of the Final StatementPurchase Price Adjustment Date. In the event that the Purchase Price Adjustment Notice sets forth a decrease in the Purchase Price, the amount of such decrease shall be set-off against the amounts due under the Note, subject to Seller's right to dispute the Purchase Price Adjustment pursuant to Section 7.2 hereof.

Adjustment to Purchase Price. In (a) As soon as practicable prior to the event the Final Statement ---------------------------- reflects anticipated Closing Date, Seller shall prepare, or cause to be prepared, and deliver to Purchaser a statement setting forth (1) Seller’s good faith estimate of Closing Net Working Capital (“Estimated Closing Net Working Capital”), Closing Cash (“Estimated Closing Cash”), Closing Indebtedness (“Estimated Closing Indebtedness”), and Closing Company Transaction Costs (“Estimated Closing Company Transaction Costs”), and (2)(A) wire transfer instructions for Seller and (B) an increase in the actual cost itemized list of the InventoryEstimated Closing Indebtedness and Estimated Closing Company Transaction Costs broken down by Person to whom such amounts are owed and wire instructions for each such Person or Persons, in each case to the extent applicable. Purchaser will be afforded an opportunity to review and comment on such statement, and, if requested by Purchaser, Seller will provide Purchaser reasonable supporting documentation related thereto, and Seller shall reasonably and in good faith consider any changes to such statement proposed by Purchaser. For the purposes of determining the amount to be paid by Purchaser to Seller at the Closing pursuant to Section 2.02(e)(ii), the aggregate Book Value of the Fixed Assets, the amount paid in Paid Time Off or the Advertising Allowance, the Base Purchase Price shall be adjusted upward (i) on a dollar for dollar basis for any increase in if Estimated Closing Net Working Capital is greater than the cost Target Amount, be increased by the amount of Inventorysuch difference, Book Value (ii) if Estimated Closing Net Working Capital is less than the Target Amount, be decreased by the amount of such difference, (iii) be increased by the Fixed Assetsamount of Estimated Closing Cash, or (iv) be decreased by the amount paid in Paid Time Offof Estimated Closing Indebtedness, and (iiv) one dollar for every two dollar increase in Advertising Allowance. In the event that the Final Statement reflects a decrease in the actual cost of the Inventory, the aggregate Book Value of the Fixed Assets, the amount paid in Paid Time Off or the Advertising Allowance, the Purchase Price shall be adjusted downward (i) on a dollar for dollar basis for any decrease in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and (ii) one dollar for every two dollar decrease in Advertising Allowance. If such adjustments result in a balance due the Sellers (after taking into account decreased by the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement), the Buyer shall pay such balance to the Parent within fifteen days after the date of determination of the Final Statement; provided, however, that in no event shall -------- ------- the Buyer be obligated to pay in the aggregate more than One Hundred Fifty Thousand Dollars ($150,000) for any Purchase Price adjustments resulting from an increase in the aggregate Book Value as of July 31, 1996, of the Fixed Assets transferred on the Estimated Closing Date. If such adjustment results in a balance due the Buyer (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement), the Sellers shall pay such balance to the Buyer within fifteen (15) days after the date of determination of the Final StatementCompany Transaction Costs.

Adjustment to Purchase Price. The Purchase Price shall be increased ----------------------------- by the Agreed Value set forth on Exhibit A of each restaurant unit that is not --------- purchased by USRP under the USRP Agreement and Buyer shall pay such increase at Closing. The Purchase Price also shall be adjusted as provided in Section5(g)(ii). In addition, as promptly as practicable, but no later than 90 days following the event Closing Date, Seller and Buyer shall jointly prepare, or cause to be prepared, in accordance with GAAP financial statements of Sybra, including a consolidated balance sheet as of the Final Statement ---------------------------- reflects an increase close of business on the Closing Date (after giving effect to the transactions contemplated in the actual cost USRP Agreement and all dividends contemplated by this Section2) (the "Closing Balance Sheet"). Within ten (10) days after completion of the InventoryClosing Balance Sheet, if the aggregate Book Value amount of Accrued Expenses and Payables as set forth in the Closing Balance Sheet, net of the Fixed Assetsaggregate amount of Cash and Inventories as set forth in the Closing Balance Sheet, the amount paid in Paid Time Off or the Advertising Allowanceis greater than $6,895,000, the Purchase Price shall be adjusted upward and the Seller shall make a cash payment in immediately available funds to the Buyer in an amount (ithe "Payment Amount") on a dollar for dollar basis for any increase equal to the difference between U.S.$6,895,000 and the aggregate amount of Accrued Expenses and Payables as set forth in the cost of InventoryClosing Balance Sheet, Book Value net of the Fixed Assets, or amount paid in Paid Time Off, aggregate of Cash and (ii) one dollar for every two dollar increase in Advertising Allowance. In the event that the Final Statement reflects a decrease Inventories as set forth in the actual cost Closing Balance Sheet, plus interest on the Payment Amount at the rate of eight percent (8%) per annum calculated from the Inventory, Closing Date through the aggregate Book Value date of such cash payment. Any payment pursuant to the Fixed Assets, the amount paid in Paid Time Off or the Advertising Allowance, the Purchase Price foregoing provisions shall be adjusted downward an adjustment (inet of any interest included in such payment) on a dollar for dollar basis for any decrease in the cost of Inventory, Book Value of the Fixed Assets, or amount paid in Paid Time Off, and (ii) one dollar for every two dollar decrease in Advertising Allowance. If such adjustments result in a balance due the Sellers (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement), the Buyer shall pay such balance to the Parent within fifteen days after the date of determination of the Final Statement; provided, however, that in no event shall -------- ------- the Buyer be obligated to pay in the aggregate more than One Hundred Fifty Thousand Dollars ($150,000) for any Purchase Price adjustments resulting from an increase in the aggregate Book Value as of July 31, 1996, of the Fixed Assets transferred on the Closing Date. If such adjustment results in a balance due the Buyer (after taking into account the amount of the upward or downward adjustment to the Purchase Price made based on the Preliminary Statement), the Sellers shall pay such balance to the Buyer within fifteen (15) days after the date of determination of the Final StatementPrice.