
	Guarantor Financial Statements

The Company's 10% Notes and 8.5% Notes are guaranteed by each of the Company's current and future domestic subsidiaries that guarantee the Company's obligations under its senior secured credit facilities (the “Guarantors”). The Guarantors are wholly-owned, either directly or indirectly, by the Company and jointly and severally guarantee the Company's obligations under the 10% Notes and 8.5% Notes. None of the Company's foreign subsidiaries guarantee the 10% Notes or 8.5% Notes.

Consolidating balance sheets related to Nortek, the Guarantors and non-Guarantor subsidiaries as of March 30, 2013 and December 31, 2012 and the related consolidating statements of operations, comprehensive income, and cash flows for the first quarter of 2013 and 2012 are reflected below in order to comply with the reporting requirements for guarantor subsidiaries.

Condensed Consolidating Balance Sheet as of March 30, 2013



			Guarantor		Non-Guarantor					Nortek
	Nortek		Subsidiaries		Subsidiaries		Eliminations			Consolidated
	(Dollar amounts in millions)
ASSETS:
Current Assets:
Unrestricted cash and cash equivalents	$	166.0	$	5.9	$	29.5	$	—		$	201.4
Restricted cash	—		—		0.2		—			0.2
Accounts receivable, less allowances	—		228.2		61.7		—			289.9
Intercompany receivables	2.2		—		34.1		(36.3		)	—
Inventories, net	—		203.0		75.2		(6.4		)	271.8
Prepaid expenses	2.3		11.0		5.1		—			18.4
Other current assets	—		4.8		9.7		(0.7		)	13.8
Prepaid income taxes	24.0		13.1		—		(1.6		)	35.5
Total current assets	194.5		466.0		215.5		(45.0		)	831.0

Property and Equipment, at Cost:
Total property and equipment, net	4.4		127.1		67.2		—			198.7

Other Long-term Assets:
Investment in subsidiaries and long-term receivable from (to) subsidiaries	1,120.6		307.7		—		(1,428.3		)	—
Goodwill	—		292.7		16.6		—			309.3
Intangible assets, less accumulated amortization	—		581.5		33.8		(11.0		)	604.3
Deferred tax asset	7.2		—		—		(7.2		)	—
Other assets	23.3		15.6		0.8		—			39.7
Total other long-term assets	1,151.1		1,197.5		51.2		(1,446.5		)	953.3
Total Assets	$	1,350.0	$	1,790.6	$	333.9	$	(1,491.5	)	$	1,983.0

LIABILITIES AND STOCKHOLDERS' INVESTMENT (DEFICIT):
Current Liabilities:
Short term bank obligations	$	—	$	—	$	0.6	$	—		$	0.6
Current maturities of long-term debt	0.3		2.2		—		—			2.5
Accounts payable	3.2		92.2		88.8		—			184.2
Accrued expenses and taxes, net	54.9		119.5		44.4		(0.7		)	218.1
Current deferred taxes	—		—		1.6		(1.6		)	—
Intercompany payables	—		36.3		—		(36.3		)	—
Total current liabilities	58.4		250.2		135.4		(38.6		)	405.4

Other Liabilities:
Deferred income taxes	—		135.5		8.7		(9.7		)	134.5
Other long-term liabilities	45.0		113.8		25.4		—			184.2
Long-term intercompany payables	—		—		43.6		(43.6		)	—
	45.0		249.3		77.7		(53.3		)	318.7

Notes, Mortgage Notes and Obligations Payable, Less Current Maturities	1,169.5		12.3		—		—			1,181.8

Stockholders' investment (deficit)	77.1		1,278.8		120.8		(1,399.6		)	77.1
Total Liabilities and Stockholders' Investment (Deficit)	$	1,350.0	$	1,790.6	$	333.9	$	(1,491.5	)	$	1,983.0

Condensed Consolidating Balance Sheet as of December 31, 2012



			Guarantor		Non-Guarantor					Nortek
	Nortek		Subsidiaries		Subsidiaries		Eliminations			Consolidated
	(Dollar amounts in millions)
ASSETS:
Current Assets:
Unrestricted cash and cash equivalents	$	94.9	$	13.1	$	36.7	$	—		$	144.7
Restricted cash	—		—		0.2		—			0.2
Accounts receivable, less allowances	—		191.7		65.7		—			257.4
Intercompany receivables	1.0		—		42.3		(43.3		)	—
Inventories, net	—		192.4		71.6		(5.6		)	258.4
Prepaid expenses	1.2		8.7		4.5		—			14.4
Other current assets	—		10.7		10.4		(1.1		)	20.0
Prepaid income taxes	18.3		12.6		—		(1.6		)	29.3
Total current assets	115.4		429.2		231.4		(51.6		)	724.4

Property and Equipment, at Cost:
Total property and equipment, net	3.0		128.7		67.8		—			199.5

Other Long-term Assets:
Investment in subsidiaries and long-term receivable from (to) subsidiaries	1,107.8		321.2		—		(1,429.0		)	—
Goodwill	—		292.7		14.9		—			307.6
Intangible assets, less accumulated amortization	—		591.6		34.5		(11.2		)	614.9
Deferred tax asset	10.9		—		—		(10.9		)	—
Other assets	25.4		15.7		0.6		—			41.7
Total other long-term assets	1,144.1		1,221.2		50.0		(1,451.1		)	964.2
Total Assets	$	1,262.5	$	1,779.1	$	349.2	$	(1,502.7	)	$	1,888.1

LIABILITIES AND STOCKHOLDERS' INVESTMENT (DEFICIT):
Current Liabilities:
Short term bank obligations	$	—	$	—	$	0.7	$	—		$	0.7
Current maturities of long-term debt	0.3		2.1		—		—			2.4
Accounts payable	4.1		76.7		93.6		—			174.4
Accrued expenses and taxes, net	31.1		119.4		48.8		(0.4		)	198.9
Current deferred taxes	—		—		1.6		(1.6		)	—
Intercompany payables	—		43.3		—		(43.3		)	—
Total current liabilities	35.5		241.5		144.7		(45.3		)	376.4

Other Liabilities:
Deferred income taxes	—		137.3		8.7		(13.3		)	132.7
Other long-term liabilities	47.7		110.3		28.9		—			186.9
Long-term intercompany payables	—		—		44.0		(44.0		)	—
	47.7		247.6		81.6		(57.3		)	319.6

Notes, Mortgage Notes and Obligations Payable, Less Current Maturities	1,085.1		12.8		—		—			1,097.9

Stockholders' investment (deficit)	94.2		1,277.2		122.9		(1,400.1		)	94.2
Total Liabilities and Stockholders' Investment (Deficit)	$	1,262.5	$	1,779.1	$	349.2	$	(1,502.7	)	$	1,888.1

Condensed Consolidating Statement of Operations and Comprehensive Income

For the first quarter ended March 30, 2013



				Guarantor			Non-Guarantor						Nortek
	Nortek			Subsidiaries			Subsidiaries			Eliminations			Consolidated
	(Dollar amounts in millions)

Net Sales	$	—		$	433.9		$	172.0		$	(86.8	)	$	519.1
Cost of products sold	—			317.9			146.4			(86.7		)	377.6
Gross profit	—			116.0			25.6			(0.1		)	141.5
Selling, general and administrative expense, net	16.9			85.7			23.0			—			125.6
Amortization of intangible assets	—			10.8			0.7			(0.2		)	11.3
Operating (loss) earnings	(16.9		)	19.5			1.9			0.1			4.6
Interest expense	(23.8		)	(0.7		)	(0.1		)	—			(24.6		)
(Loss) income before charges and allocations to subsidiaries and equity in subsidiaries' (loss) earnings before income taxes	(40.7		)	18.8			1.8			0.1			(20.0		)
Charges and allocations to subsidiaries and equity in subsidiaries' (loss) earnings before income taxes	20.7			(16.2		)	0.2			(4.7		)	—
(Loss) earnings before (benefit) provision for income taxes	(20.0		)	2.6			2.0			(4.6		)	(20.0		)
(Benefit) provision for income taxes	(4.9		)	0.1			0.9			(1.0		)	(4.9		)
Net (loss) earnings	$	(15.1	)	$	2.5		$	1.1		$	(3.6	)	$	(15.1	)

Comprehensive (loss) income	$	(18.1	)	$	2.6		$	(2.1	)	$	(0.5	)	$	(18.1	)

Condensed Consolidating Statement of Operations and Comprehensive Income

For the first quarter ended March 31, 2012



				Guarantor			Non-Guarantor						Nortek
	Nortek			Subsidiaries			Subsidiaries			Eliminations			Consolidated
	(Dollar amounts in millions)

Net Sales	$	—		$	421.6		$	165.7		$	(64.5	)	$	522.8
Cost of products sold	—			301.3			139.9			(64.4		)	376.8
Gross profit	—			120.3			25.8			(0.1		)	146.0
Selling, general and administrative expense, net	7.8			82.3			20.0			—			110.1
Amortization of intangible assets	—			10.3			0.7			—			11.0
Operating (loss) earnings	(7.8		)	27.7			5.1			(0.1		)	24.9
Interest expense	(23.6		)	(0.7		)	(0.2		)	—			(24.5		)
(Loss) income before charges and allocations to subsidiaries and equity in subsidiaries' earnings (loss) before income taxes	(31.4		)	27.0			4.9			(0.1		)	0.4
Charges and allocations to subsidiaries and equity in subsidiaries' earnings (loss) before income taxes	31.8			(14.3		)	0.1			(17.6		)	—
Earnings (loss) before provision (benefit) for income taxes	0.4			12.7			5.0			(17.7		)	0.4
Provision (benefit) for income taxes	1.6			4.8			3.0			(7.8		)	1.6
Net (loss) earnings	$	(1.2	)	$	7.9		$	2.0		$	(9.9	)	$	(1.2	)

Comprehensive income (loss)	$	0.7		$	7.9		$	4.2		$	(12.1	)	$	0.7

Condensed Consolidating Cash Flow Statement

For the first quarter ended March 30, 2013



				Guarantor			Non-Guarantor			Nortek
	Nortek			Subsidiaries			Subsidiaries			Consolidated
	(Dollar amounts in millions)

Cash Flows from operating activities:
Net cash (used in) provided by operating activities	$	(18.3	)	$	6.8		$	(3.0	)	$	(14.5	)
Cash Flows from investing activities:
Capital expenditures	(1.5		)	(4.9		)	(3.4		)	(9.8		)
Net cash paid for businesses acquired	—			—			(0.9		)	(0.9		)
Change in restricted cash and marketable securities	—			0.1			—			0.1
Other, net	—			(0.9		)	0.1			(0.8		)
Net cash used in investing activities	(1.5		)	(5.7		)	(4.2		)	(11.4		)

Cash Flows from financing activities:
Increase in borrowings	85.0			—			0.8			85.8
Payment of borrowings	(0.1		)	(0.7		)	(0.8		)	(1.6		)
Net use from equity transactions	(1.6		)	—			—			(1.6		)
Long-term intercompany advances and loans	7.6			(7.6		)	—			—
Net cash provided by (used in) financing activities	90.9			(8.3		)	—			82.6
Net change in unrestricted cash and cash equivalents	71.1			(7.2		)	(7.2		)	56.7
Unrestricted cash and cash equivalents at the beginning of the period	94.9			13.1			36.7			144.7
Unrestricted cash and cash equivalents at the end of the period	$	166.0		$	5.9		$	29.5		$	201.4

Condensed Consolidating Cash Flow Statement

For the first quarter ended March 31, 2012



				Guarantor			Non-Guarantor			Nortek
	Nortek			Subsidiaries			Subsidiaries			Consolidated
	(Dollar amounts in millions)

Cash Flows from operating activities:
Net cash (used in) provided by operating activities	$	(16.5	)	$	59.8		$	1.0		$	44.3
Cash Flows from investing activities:
Capital expenditures	—			(3.1		)	(1.4		)	(4.5		)
Proceeds from the sale of property and equipment	—			1.5			—			1.5
Change in restricted cash and marketable securities	0.1			—			—			0.1
Other, net	—			(0.1		)	—			(0.1		)
Net cash provided by (used in) investing activities	0.1			(1.7		)	(1.4		)	(3.0		)

Cash Flows from financing activities:
Increase in borrowings	—			—			1.6			1.6
Payment of borrowings	(25.9		)	(0.6		)	(2.2		)	(28.7		)
Long-term intercompany advances and loans	59.1			(64.1		)	5.0			—
Net cash provided by (used in) financing activities	33.2			(64.7		)	4.4			(27.1		)
Net change in unrestricted cash and cash equivalents	16.8			(6.6		)	4.0			14.2
Unrestricted cash and cash equivalents at the beginning of the period	17.8			9.3			31.1			58.2
Unrestricted cash and cash equivalents at the end of the period	$	34.6		$	2.7		$	35.1		$	72.4