THIRTY (30) DAYS AFTER THE CLOSING DATE, SELLER SHALL CAUSE
TO BE PREPARED AND SHALL DELIVER TO BUYER A PRELIMINARY BALANCE SHEET OF SELLER
AS OF THE CLOSE OF BUSINESS ON THE CLOSING DATE, WHICH BALANCE SHEET SHALL
REFLECT, AMONG OTHER THINGS, TOTAL CURRENT ASSETS (OTHER THAN INTERCOMPANY
RECEIVABLES AND AN AMOUNT OF CASH SUFFICIENT TO SATISFY SECTION 1.3(C) BELOW),
TOTAL CURRENT LIABILITIES AND NET PLANT AND EQUIPMENT ("PRELIMINARY CLOSING DATE
BALANCE SHEET").
CURRENT LIABILITIES SHALL ONLY INCLUDE ASSUMED LIABILITIES (AS
DEFINED IN SECTION 1.4 BELOW).
THE PRELIMINARY CLOSING DATE BALANCE SHEET SHALL
BE PREPARED IN ACCORDANCE WITH CANADIAN GAAP APPLIED IN A MANNER CONSISTENT WITH
THAT UTILIZED IN PREPARING THE FINANCIAL STATEMENTS (AS DEFINED IN SECTION 3.6).
(B)
BUYER SHALL HAVE THIRTY (30) DAYS FOLLOWING RECEIPT OF THE
PRELIMINARY CLOSING DATE BALANCE SHEET TO REVIEW AND MAKE ADJUSTMENTS TO THE
PRELIMINARY CLOSING DATE BALANCE SHEET, INCLUDING PREPARATION OF A SCHEDULE
TRANSLATING THE PRELIMINARY CLOSING DATE BALANCE SHEET INTO U.S. DOLLARS FOR
PURPOSES OF MEASURING THE NET CURRENT ASSETS (AS DEFINED BELOW).
SELLER SHALL
GIVE SUPPORT AND PROVIDE INFORMATION TO BUYER AS REASONABLY NECESSARY DURING
BUYER'S REVIEW PERIOD TO FACILITATE A SUBSTANTIVE REVIEW AND ADJUSTMENT.
BUYER
SHALL DELIVER THE REVIEWED AND ADJUSTED PRELIMINARY CLOSING DATE BALANCE SHEET
("BUYER'S ADJUSTED CLOSING DATE BALANCE SHEET") TO SELLER PRIOR TO THE END OF
SUCH THIRTY (30) DAY PERIOD.
(C)
IF SELLER DOES NOT DISPUTE THE AMOUNTS SET FORTH IN THE BUYER'S
ADJUSTED CLOSING DATE BALANCE SHEET, THE BUYER'S ADJUSTED CLOSING DATE BALANCE
SHEET SHALL BE CONCLUSIVE.
IF SELLER DISPUTES ANY AMOUNT SET FORTH IN THE
BUYER'S ADJUSTED CLOSING DATE BALANCE SHEET, SELLER SHALL SO NOTIFY BUYER IN
WRITING (SPECIFYING SELLER'S OBJECTIONS AND THE REASONS THEREFOR IN REASONABLE
DETAIL) WITHIN THIRTY (30) DAYS FOLLOWING RECEIPT THEREOF AND THE PARTIES WILL
USE ALL REASONABLE EFFORTS TO RESOLVE ANY SUCH DISPUTES.
IF ANY SUCH DISPUTE
CANNOT PROMPTLY BE RESOLVED (BUT IN ANY EVENT WITHIN THIRTY (30) DAYS AFTER
SUBMISSION OF THE WRITTEN OBJECTIONS OF SELLER, THE PARTIES AGREE THAT THEY WILL
SUBMIT THE MATTER TO THE OFFICE OF JAMS/ENDISPUTE LOCATED IN SAN DIEGO,
CALIFORNIA (OR, IF NONE, THEN THE OFFICE OF JAMS/ENDISPUTE LOCATED CLOSEST TO
SAN DIEGO, CALIFORNIA) TO BE ARBITRATED BY A SINGLE ARBITRATOR TO BE MUTUALLY
SELECTED BY THE PARTIES.
THE RESOLUTION OF THE DISPUTE BY JAMS/ENDISPUTE WILL
BE CONCLUSIVE AND BINDING UPON THE PARTIES.
THE FEES AND EXPENSES OF
JAMS/ENDISPUTE WILL BE PAID BY THE PARTY JAMS/ENDISPUTE DETERMINES TO BE THE
NON-PREVAILING PARTY, OR IF THERE IS NO PREVAILING PARTY AS DETERMINED BY THE
ARBITRATOR.
THE BUYER'S ADJUSTED CLOSING DATE BALANCE SHEET AND THE INFORMATION
SET FORTH THEREON, AS FINALLY DETERMINED PURSUANT TO THIS SECTION 1.3(B), IS
HEREINAFTER REFERRED TO AS THE "FINAL CLOSING BALANCE SHEET."
(D)
IN THE EVENT THE CURRENT ASSETS LESS CURRENT LIABILITIES SET FORTH
IN THE FINAL CLOSING BALANCE SHEET ("NET CURRENT ASSETS") IS LESS THAN $925,000,
THEN SELLER SHALL BE LIABLE TO PAY OVER TO BUYER AN AMOUNT IN CASH EQUAL TO THE
DIFFERENCE BETWEEN (I) $925,000 AND