Nautilus 2006 Annual Report Download - page 153

16
Article 3.9 Litigation . Except as set forth in Schedule 3.9, there is no action, lawsuit, claim, proceeding, or investigation pending or, to
the best knowledge of Seller and the Shareholders, threatened against or affecting Seller which, if decided adversely against
Seller, could have a material adverse effect upon the Business or its financial condition, prospects or operations, or upon the
Assets. Seller is not in default, and no condition exists that with notice or the lapse of time or both would constitute a default,
with respect to any order, writ, injunction or decree of any court or Government Authority affecting or relating to the
Business. No condemnation proceeding has been commenced or, to the knowledge of Seller or any Shareholder, is
threatened to be commenced against any of the Assets.
Article 3.10 Brokers’ or Finders’ Fees . Except as set forth in Schedule 3.10, neither Seller nor any Shareholder has paid or will become
obligated to pay any fee or commission to any broker, finder or intermediary for or on account of the transactions provided
for in this Agreement.
Article 3.11
Subsidiaries
. Except as set forth in Schedule 3.11, Seller has no subsidiaries or branches.
Article 3.12 Financial Statements . Seller has delivered to Nautilus: (a) a pro forma unaudited balance sheet of the Business as at
December 31, 2006 (including the notes thereto, the “2006 Balance Sheet”), and the related pro forma unaudited statements
of income, changes in shareholders' equity and cash flows for the fiscal year then ended, including the notes thereto, certified
by the CEO/President and chief financial officer of Seller; and (b) unaudited pro forma balance sheets of the Business as at
each of March 31, 2007 and June 30, 2007 (the “Interim Balance Sheets”) and the related unaudited pro forma statements of
income, changes in shareholders' equity, and cash flows for the fiscal quarters then ended, including the notes thereto,
certified by the CEO/President and chief financial officer of Seller. Such financial statements fairly present (and the financial
statements delivered pursuant to Section 5.11 will fairly present) the financial condition and the results of operations,
changes in shareholders' equity and cash flows of the Business, as at the respective dates of and for the periods referred to in
such financial statements, all in accordance with U.S. GAAP. The financial statements referred to in this Section 3.12 reflect
the consistent application of such accounting principles throughout the periods involved. The financial statements have been
prepared from and are in accordance with the accounting records of Seller. Seller has also delivered to Buyer copies of all
letters from the Seller’s auditors to the Seller's board of directors or the audit committee thereof dated during 2007, together
with copies of all responses thereto.
Article 3.13
No Undisclosed Liabilities.
The Business has no material liabilities except for liabilities reflected or reserved against in the
2006 Balance Sheet or the Interim Balance Sheets and current liabilities incurred in the ordinary course of business of the
Business since June 30, 2007.