Article 8 entitles the buyer to withdraw from the contract if the seller fails to perform certain contractual obligations between the "Present Date" and the "Closing Date" or if the buyer has given incorrect assurances.

In view of the fact that there is no "Closing Date" in this sense under German law as already said on numerous occasions the rulings included under Article 8 cannot be applied under German law for an agreement concluded under German law for the purchase and sale of a company. Sections 8.1, 8.2 and 8.3 may be analogously taken over in the purchase and sale agreement under German law, however, whereby it can be agreed that the buyer is entitled to withdraw from the contract and if necessary to demand compensation in the event of noncompliance with the prerequisites of the above-mentioned clauses.

Sections 8.4, 8.5, 8.6 and 8.7 apply exclusively for US law. Section 8.8 is superfluous for a purchase and sale agreement under German law as the law stipulates in =A7 613 a of the German Civil Code in any case that the rights and obligations under employment contracts are assumed by the buyer upon the transfer of the ownership of the company.

With regard to all further obligations, i.e. Sections 8.9 to 8.12, the above comments on Sections 8.1 to 8.3 apply accordingly. This concerns obligations which grant the buyer the possibility in the master contract not to perform the contract if certain prerequisites are not met by the seller. It would at best be possible to grant the seller a withdrawal from the contract or a compensation claim under German law, as mentioned above.

For further information please contact Dr Erich Michel, Wessing Berenberg-Gossler Zimmermann Lange, Freiherr-Vom-Stein-Strasse 24-26, Frankfurt am Maim 60323, Frankfurt, Germany- Tel: +496 997 1300, Fax: +496 997 130100.

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