31, 2006 AND 2007 AND AS OF JUNE 30, 2008, AND THE
RELATED UNAUDITED STATEMENTS OF OPERATIONS AND CHANGES IN MEMBERS' EQUITY FOR
THE TWO FISCAL YEARS AND SIX MONTH PERIOD THEN ENDED (COLLECTIVELY, THE
"FINANCIAL STATEMENTS"). THE FINANCIAL STATEMENTS (I) HAVE BEEN PREPARED
UTILIZING GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN THE UNITED STATES
CONSISTENTLY APPLIED; (II) PRESENT FAIRLY, IN ALL MATERIAL RESPECTS, THE
FINANCIAL CONDITION OF THE COMPANY AS OF THE DATES THEREOF AND THE RESULTS OF
ITS OPERATIONS FOR THE PERIODS THEN ENDED; AND (III) ARE CONSISTENT WITH THE
BOOKS AND RECORDS OF THE COMPANY, WHICH BOOKS AND RECORDS ARE TRUE, CORRECT AND
COMPLETE IN ALL MATERIAL RESPECTS.
(Y)
NO UNDISCLOSED LIABILITIES.
AT CLOSING, THE
COMPANY WILL HAVE NO DEBT, LIABILITY OR OBLIGATION OF ANY KIND, WHETHER ACCRUED,
ABSOLUTE, CONTINGENT, INCHOATE, DETERMINED, DETERMINABLE OR OTHERWISE, EXCEPT
FOR (I) LIABILITIES OR OBLIGATIONS INCURRED IN THE ORDINARY COURSE OF BUSINESS
WHICH, INDIVIDUALLY OR IN THE AGGREGATE WOULD NOT HAVE A MATERIAL ADVERSE EFFECT
ON THE COMPANY, (II) LIABILITIES OR OBLIGATIONS UNDER THIS AGREEMENT OR INCURRED
IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED HEREBY, OR (III) LIABILITIES OR
OBLIGATIONS DISCLOSED IN THE FINANCIAL STATEMENTS.
(Z)
NO MATERIAL CHANGES.
SINCE JUNE 30, 2008 THE
COMPANY HAS CONDUCTED ITS BUSINESS ONLY IN THE ORDINARY COURSE CONSISTENT WITH
PAST PRACTICES AND THERE HAS NOT BEEN: (A) ANY AMENDMENT OR CHANGE IN THE
ORGANIZATIONAL DOCUMENTS OR EQUITY SECURITIES OF THE COMPANY, (B) ANY
REPURCHASE, REDEMPTION OR OTHER ACQUISITION BY THE COMPANY OF ANY SECURITIES OF,
OR OTHER OWNERSHIP INTERESTS IN THE COMPANY, (C) ANY CHANGE IN ANY METHOD OF
ACCOUNTING OR ACCOUNTING PRACTICE OR ANY TAX METHOD, PRACTICE OR ELECTION BY THE
COMPANY, (D) ANY SALE, ASSIGNMENT OR OTHER DISPOSITION OF ANY MATERIAL ASSET,
(E) ANY
26
COMMITMENT OR DISPUTE THAT WOULD REASONABLY BE EXPECTED TO HAVE A MATERIAL
ADVERSE EFFECT ON THE COMPANY, (F) ANY MATERIAL ADVERSE CHANGE IN THE FINANCIAL
CONDITION, OPERATIONS, ASSETS, LIABILITIES OR BUSINESS OF THE COMPANY OR ANY
MATERIAL CHANGE IN THE GENERAL AND ADMINISTRATIVE EXPENSES OF THE COMPANY;
(G) ANY DECLARATION, SETTING ASIDE, OR PAYMENT OF ANY DIVIDEND OR OTHER
DISTRIBUTION IN RESPECT OF THE COMPANY'S CAPITAL STOCK OR OTHER EQUITY
SECURITIES, (H) ANY LABOR OR EMPLOYMENT DISPUTE OF WHATEVER NATURE OR ANY
BONUSES PAID OR MATERIAL CHANGE IN EMPLOYEE COMPENSATION OR BENEFITS, (I) ANY
INVESTMENT OR LOAN MADE BY THE COMPANY, (J) ANY LIEN, CLAIM OR OTHER ENCUMBRANCE
(EXCEPT PERMITTED ENCUMBRANCES) CREATED ON ANY ASSET OF THE COMPANY, (K) ANY
INDEBTEDNESS INCURRED BY THE COMPANY, (L) ANY TRANSACTION WITH ANY AFFILIATE OF
THE COMPANY, (M) ANY MATERIAL TRANSACTION OR AGREEMENT ENTERED INTO OR AMENDED
BY THE COMPANY, (N) ANY ACTION WHICH WOULD HAVE BEEN PROHIBITED UNDER
SECTIONS 9.1 AND 9.2 HEREOF, (O) ANY DISCHARGE OR SATISFACTION OF ANY LIEN,
CLAIM OR OTHER ENCUMBRANCE OR PAYMENT OF ANY OBLIGATION OR LIABILITY, ABSOLUTE
OR CONTINGENT, OTHER THAN CURRENT LIABILITIES INCURRED AND PAID IN THE ORDINARY
COURSE OF BUSINESS AND CONSISTENT WITH PAST PRACTICES, (P) ANY DELAY OR
POSTPONEMENT IN THE PAYMENT