Nautilus 2009 Annual Report Download - page 11

Table of Contents
EMPLOYEES
As of January 31, 2010, we had approximately 640 employees, substantially all of which were full-time, and approximately 280 of which were
employed in connection with our commercial business discontinued operation. None of our employees are subject to collective bargaining
agreements. We have not experienced a material interruption of our operations due to labor disputes.
SIGNIFICANT CUSTOMERS
No individual customer accounted for 10 percent or more of our consolidated net sales in the past two fiscal years.
INTELLECTUAL PROPERTY
Trademarks, patents and other forms of intellectual property are vital to the success of our business and an essential factor in maintaining our
competitive position in the health and fitness industry.
Trademarks
We own many trademarks including Nautilus , Bowflex , PowerRod , Revolution , Mobia , TreadClimber , Schwinn Fitness,
SelectTech , Trimline and Universal . The vast majority of our trademarks are either registered or protected by common law rights. We
believe that having distinctive trademarks, which are readily identifiable by consumers, is an important factor in creating a market for our
products, creating a strong company identity and developing brand loyalty among our customers.
Each federally registered trademark is renewable indefinitely if the trademark is still in use at the time of renewal. We are not aware of any
material claims of infringement or other challenges to our trademark rights in our major markets.
Patents
We own a broad array of patents and patent rights, both issued and pending, covering our fitness equipment. These patents cover a variety of
technologies, some of which are utilized in the following products: TreadClimber ; variable stride ellipticals; selectorized weights; recumbent
bicycles; and the Bowflex Revolution . Patent protection for these technologies extends as far as 2020, with none expiring prior to 2011.
Expiration of these and other patents could trigger the introduction of similar products by our competitors. Patent protection has ended for our
rod-based home gyms.
Building our intellectual property portfolio is an important factor in maintaining our competitive position in the health and fitness equipment
industry. We have followed a policy of filing applications for U.S. and foreign patents on inventions, new designs and improvements that we
deem valuable to our business. We protect our proprietary rights vigorously and take prompt, reasonable actions to prevent counterfeit
reproductions or other infringement on our intellectual property.
ENVIRONMENTAL AND OTHER REGULATORY MATTERS
Our operations are subject to various laws and regulations both domestically and abroad. In the United States, federal, state and local regulations
impose standards on our workplace and our relationship with the environment. For example, the U.S. Environmental Protection Agency
(“EPA”), Occupational Safety and Health Administration (“OSHA”) and other federal agencies have the authority to promulgate regulations
which may impact our operations. In particular, we are subject to legislation placing restrictions on our generation, emission, treatment, storage
and disposal of materials, substances and wastes. Such legislation includes: the Toxic Substances Control Act; the Resource Conservation and
Recovery Act; the Clean Air Act; the Clean Water Act; the Safe Drinking Water Act; and the Comprehensive Environmental Response and the
Compensation and
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