REASONABLE EFFORTS FOR A PERIOD OF TWENTY (20) DAYS FOLLOWING RECEIPT OF THE
CALCULATION OF THE VALUATION OF THE CLOSING INVENTORY (OR SUCH LONGER PERIOD AS
THEY MAY MUTUALLY AGREE) TO RESOLVE ANY DISAGREEMENTS WITH RESPECT TO THE
CALCULATION OF THE CLOSING INVENTORY.
IF, AT THE END OF SUCH PERIOD, THEY ARE
UNABLE TO RESOLVE SUCH DISAGREEMENTS, THE BANKRUPTCY COURT SHALL RESOLVE ANY
REMAINING MATTERS IN DISPUTE.
2.7
ALLOCATION.
PURCHASER SHALL USE ITS COMMERCIALLY REASONABLE
EFFORTS TO DELIVER TO SELLER, WITHIN NINETY (90) DAYS FOLLOWING THE CLOSING
DATE, THE ALLOCATION OF THE PURCHASE PRICE, AMONG THE TRANSFERRED ASSETS (THE
"ALLOCATION").
THE ALLOCATION WILL BE MADE BY PURCHASER IN GOOD FAITH AND IN
ACCORDANCE WITH SECTION 1060 OF THE CODE AND THE TREASURY REGULATIONS
PROMULGATED THEREUNDER (IT BEING UNDERSTOOD THAT AN ALLOCATION PROVIDED BY AN
INDEPENDENT THIRD PARTY SHALL BE DEEMED TO BE IN GOOD FAITH).
SELLER AND
PURCHASER AGREE TO (A) BE BOUND BY THE ALLOCATION, (B) ACT IN ACCORDANCE WITH
THE ALLOCATION IN THE PREPARATION OF FINANCIAL STATEMENTS AND FILING OF ALL TAX
RETURNS (INCLUDING FILING FORM 8594 WITH THEIR UNITED STATES FEDERAL INCOME TAX
RETURN FOR THE TAXABLE YEAR THAT INCLUDES THE DATE OF THE CLOSING) AND IN THE
COURSE OF ANY TAX AUDIT, TAX REVIEW OR TAX LITIGATION RELATING THERETO AND
(C) TAKE NO POSITION AND CAUSE THEIR AFFILIATES TO TAKE NO POSITION INCONSISTENT
WITH THE ALLOCATION FOR INCOME TAX PURPOSES,
17
INCLUDING UNITED STATES FEDERAL AND STATE INCOME TAX AND FOREIGN INCOME TAX.
NOT LATER THAN THIRTY (30) DAYS PRIOR TO THE FILING OF THEIR RESPECTIVE FORMS
8594 (AND ANALOGOUS STATE LAW FORMS) RELATING TO THE ACQUISITION, EACH PARTY
SHALL DELIVER TO THE OTHER PARTY A COPY OF ITS FORM 8594 (AND ANY ANALOGOUS
STATE LAW FORMS).
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF SELLER
As an inducement of Purchaser to enter into this Agreement, Seller hereby makes
the following representations and warranties to Purchaser, except as otherwise
set forth in the Disclosure Schedule.
The sections of the Disclosure Schedule
are numbered to correspond to the various subsections of this Article 3 setting
forth certain exceptions to the representations and warranties contained in this
Article 3 and certain other information called for by this Agreement.
No
disclosure made in any particular section of the Disclosure Schedule shall be
deemed made in any other section of the Disclosure Schedule unless (a) expressly
made therein (by cross-reference or otherwise) or (b) it is reasonably apparent
on its face that such disclosure applies to such other section of the Disclosure
Schedule.
As used in this Agreement, references to the "knowledge" or
"awareness" means with respect to any matter in question, in the case of Seller,
if the president or vice president of Seller has actual knowledge or knowledge
that such person would reasonably be expected to have in the ordinary course of
his employment duties.
3.1
ORGANIZATION AND GOOD STANDING; SHAREHOLDERS.
SELLER IS A
CORPORATION DULY ORGANIZED, VALIDLY EXISTING AND IN GOOD STANDING UNDER THE LAWS
OF THE STATE