held back to fund future costs and expenses as may be
agreed to among the Sellers, the Closing Date Cash Consideration shall be
distributed by the Sellers' Representative among the Sellers according to each
such Seller's Applicable Percentage of such Closing Date Cash Consideration.
The Purchaser agrees to deposit with the Escrow Agent at the Closing the Escrow
Cash and the Change of Control Escrow Cash (if applicable) in cash payable by
wire transfer or delivery of other immediately available funds (with the Escrow
Cash consisting of that portion of the cash otherwise payable to each Seller
based upon the Applicable Percentages) to be available to satisfy amounts owed
by the Sellers to the Purchaser under this Agreement, if any, in accordance with
the terms of this Agreement and the Escrow Agreement.
Section 2.03
Earn-Out.
(A)
AS PROMPTLY AS PRACTICABLE AFTER THE FIRST AND SECOND
ANNIVERSARIES OF THE LAST DAY OF THE CALENDAR MONTH THAT INCLUDES THE CLOSING
DATE (EACH 12-MONTH PERIOD IMMEDIATELY PRIOR TO EACH SUCH DATE BEING HEREIN
REFERRED TO AS AN "EARN-OUT PERIOD," THE EARN-OUT PERIOD ENDING ON SUCH FIRST
ANNIVERSARY BEING HEREIN REFERRED TO AS THE "2009 EARN-OUT PERIOD" AND THE
EARN-OUT PERIOD ENDING ON SUCH SECOND ANNIVERSARY BEING
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HEREIN REFERRED TO AS THE "2010 EARN-OUT PERIOD"), BUT IN NO EVENT LATER THAN
THIRTY (30) BUSINESS DAYS THEREAFTER, THE PURCHASER SHALL DELIVER TO THE
SELLERS' REPRESENTATIVE A CERTIFICATE SIGNED BY THE CHIEF FINANCIAL OFFICER OR
SIMILAR OFFICER OF THE PURCHASER SETTING FORTH THE GROSS PROFIT WITH RESPECT TO
THE DIAGNA CUSTOMERS FOR THE RELEVANT EARN-OUT PERIOD (THE "EARN-OUT
STATEMENT").
EACH RESPECTIVE EARN-OUT STATEMENT SHALL BE PREPARED BASED UPON
AMOUNTS USED IN PREPARATION OF THE UNAUDITED INCOME STATEMENT OF THE PURCHASER
AS OF THE LAST DAY OF THE APPROPRIATE EARN-OUT PERIOD, WHICH SUCH UNAUDITED
INCOME STATEMENT SHALL BE PREPARED IN ACCORDANCE WITH GAAP (AS IN EFFECT ON THE
CLOSING DATE) APPLIED CONSISTENTLY WITH THE UNAUDITED INCOME STATEMENT OF THE
COMPANY FOR THE PERIOD ENDING MARCH 31, 2008.
(B)
WITHIN THIRTY (30) DAYS AFTER RECEIPT OF EACH EARN-OUT STATEMENT
(THE "EARN-OUT OBJECTION PERIOD"), THE SELLERS' REPRESENTATIVE BY WRITTEN NOTICE
TO THE PURCHASER MAY OBJECT TO ANY ITEMS SHOWN THEREON, SETTING FORTH IN SUCH
NOTICE (THE "EARN-OUT OBJECTION NOTICE") THE SELLERS' REPRESENTATIVE'S OBJECTION
IN REASONABLE DETAIL AND THE SELLERS' REPRESENTATIVE'S PROPOSAL OR PROPOSALS
WITH RESPECT TO THE CALCULATION OF ANY ITEMS SHOWN THEREON.
WITHIN TWENTY (20)
DAYS FOLLOWING TIMELY DELIVERY OF THE EARN-OUT OBJECTION NOTICE, THE PURCHASER
AND THE SELLERS' REPRESENTATIVE SHALL ATTEMPT, IN GOOD FAITH, TO RESOLVE ALL
DISPUTES BETWEEN THEM CONCERNING THE EARN-OUT OBJECTION NOTICE.
IF THE
PURCHASER AND THE SELLERS' REPRESENTATIVE CANNOT RESOLVE SUCH DISPUTES WITHIN
SUCH TWENTY (20) DAY PERIOD, THEN ALL DISAGREEMENTS WILL BE SUBMITTED FOR
RESOLUTION TO THE INDEPENDENT ACCOUNTANT.
PROMPTLY, BUT NOT LATER THAN TWENTY
(20) DAYS AFTER THE DISPUTE HAS BEEN SUBMITTED TO THE INDEPENDENT ACCOUNTANT,
THE INDEPENDENT ACCOUNTANT SHALL DETERMINE (BASED SOLELY ON PRESENTATIONS BY THE
SELLERS' REPRESENTATIVE AND THE PURCHASER TO THE INDEPENDENT ACCOUNTANT, AND NOT
BY