Supercuts 2008 Annual Report Download - page 148

5.4 Subsidiaries . The attached Subsidiary Schedule
correctly sets forth the name of each Subsidiary of the Company, the jurisdiction of
its organization and the Persons owning the outstanding Capital Stock of such Subsidiary. Each Subsidiary is duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization and possesses all requisite corporate power and corporate authority
necessary to own its properties and to carry on its businesses as now being conducted and is qualified to do business in every jurisdiction in
which its ownership of property or the conduct of business requires it to qualify, except where the failure to be so qualified could not reasonably
be expected to have a Material Adverse Effect. All of the Capital Stock of each Subsidiary is validly issued, fully paid and nonassessable, and,
except as set forth on the Subsidiary Schedule , all of the Capital Stock of each Subsidiary is owned by the Company or by a Subsidiary of the
Company free and clear of all Encumbrances. Neither the Company nor any of its Subsidiaries owns or holds the right to acquire any Capital
Stock or any other security or interest in any other Person or has any obligation to make any Investment in any Person. The attached
Officers and
Directors Schedule
sets forth a list all of the officers and directors of each of the Company's Subsidiaries. The copies of each Subsidiary's articles
of incorporation and bylaws (or similar governing documents or operating agreements) which have been furnished to Buyer reflect all
amendments made thereto at any time prior to the date of this Agreement and are correct and complete.
5.5 Financial Statements . Attached hereto as the Financial Statements Schedule are the following financial statements:
(a) the audited consolidated balance sheet of BeautyFirst and its Subsidiaries as of June 27, 2007, and the related statements of income and
cash flows (or the equivalent) for the fiscal year then ended, and the audited consolidated balance sheet of BeautyFirst and its Subsidiaries as of
December 27, 2006, and the related statements of income and cash flows (or the equivalent) for the fiscal year then ended;
(b) the unaudited consolidated balance sheet of the Company and its Subsidiaries as of June 27, 2007, and the related unaudited statements
of income and cash flows (or the equivalent) for the fiscal years then ended; and
(c) the unaudited consolidated balance sheet of BeautyFirst and its Subsidiaries as of November 21, 2007 (the " Latest Balance Sheet "),
and the related unaudited statements of income and cash flows (or the equivalent) for the five-month period then ended.
Each of the financial statements referenced above (including in all cases the notes thereto, if any), is accurate and complete in all material
respects, is consistent in all material respects with the books and records of BeautyFirst and its Subsidiaries or the Company and its Subsidiaries,
as applicable (which, in turn, are accurate and complete in all material respects), fairly presents the financial condition of BeautyFirst and its
Subsidiaries or the Company and its Subsidiaries, as applicable, as of the respective dates thereof and the operating results of BeautyFirst and its
Subsidiaries or the Company and its Subsidiaries, as applicable, for the periods covered thereby and has been prepared in accordance with
GAAP consistently applied throughout the periods covered thereby, subject in the case of the unaudited financial statements to the absence of
footnote disclosures and changes resulting from normal year-end adjustments for recurring accruals (none of which footnote disclosures or
changes would, alone or in the aggregate, be materially adverse to the business, operations, assets, liabilities, financial condition, operating
results, value, cash flow or net worth of the Company and its Subsidiaries taken as a whole).
5.6 Accounts Receivable . Except as set forth on the attached Accounts Receivable Schedule
, all accounts and notes receivable reflected
on the Latest Balance Sheet (net of allowances for doubtful accounts as reflected thereon and as determined in accordance with GAAP) and, to
the Company's knowledge, all accounts and notes receivable that arise after the date thereof through Closing, are or shall be valid receivables
arising in the ordinary course of business and are or shall be current and
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