EXHIBIT 99.1
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The Brainy Brands Company, Inc.
An Overview
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The Brainy Brands Company
Certain statements in this presentation are forward-looking. These statements are subject to risks and uncertainties. Words such as "expects“, "intends",
"plans", "may", "could", "should", "anticipates", "likely", "believes“ and words of similar import also identify forward-looking statements. Forward-looking
statements are based on current facts and analyses and other information that are based on forecasts of future results, estimates of amounts not yet
determined and assumptions of management. Actual results may differ materially from those currently anticipated due to a number of factors beyond the
reasonable control of the Company.
"plans", "may", "could", "should", "anticipates", "likely", "believes“ and words of similar import also identify forward-looking statements. Forward-looking
statements are based on current facts and analyses and other information that are based on forecasts of future results, estimates of amounts not yet
determined and assumptions of management. Actual results may differ materially from those currently anticipated due to a number of factors beyond the
reasonable control of the Company.
If you are viewing or have received this presentation, you understand that certain of the information contained herein may be confidential and not
currently publicly available. Accordingly, you agree to treat this information, including information on or about possible future transactions, in strict
confidence and not to disclose such information to any other party. You understand that the Company may rely on your agreement of confidentiality to
comply with the exemptive provisions of SEC Regulation FD or other applicable regulations. In addition, you acknowledge that you are aware that the
United States securities laws generally prohibit any person who is in possession of material nonpublic information about a company from purchasing or
selling securities of such company.
currently publicly available. Accordingly, you agree to treat this information, including information on or about possible future transactions, in strict
confidence and not to disclose such information to any other party. You understand that the Company may rely on your agreement of confidentiality to
comply with the exemptive provisions of SEC Regulation FD or other applicable regulations. In addition, you acknowledge that you are aware that the
United States securities laws generally prohibit any person who is in possession of material nonpublic information about a company from purchasing or
selling securities of such company.
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The Brainy Brands Company develops and markets an extensive
library of early childhood learning products, including a full range of
puzzles, books, games, toys and audio-visual materials for the US
market and international marketplace.
library of early childhood learning products, including a full range of
puzzles, books, games, toys and audio-visual materials for the US
market and international marketplace.
Company Overview
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In 1995, the Brainy Baby brand pioneered the early childhood educational DVD
industry. The Company has progressively expanded its range of products for children
ages 9 months to 5 years, to include:
industry. The Company has progressively expanded its range of products for children
ages 9 months to 5 years, to include:
Company Overview
•Over 200 SKUs
•DVDs
•CDs
•Books
•Toys
•Games
•Puzzles
•Flash Cards
Brainy Brands products have received 76 National and International Awards.
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• Licensed in 70 countries
• 12 years in Toys "R" Us and Babies "R" Us
• Recently expanded slots in Toys "R" Us
• New placement in 175 Babies "R" Us in Australia
• New placement in 40 Borders book stores in Australia
• QVC debut December 2009, additional appearance scheduled 2010
Company Overview
Distribution
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Brainy Baby® has developed a market image as a high quality, premium brand
that is sold mostly in specialty stores rather than through big box retailers. Brainy
Baby has consciously avoided these mass market retailers which erode image,
pricing and margins and pull the customer base from the smaller, high-end
stores. The company has not invested in marketing efforts Direct-To- Consumer
(DTC) because of lack of access to investment capital.
that is sold mostly in specialty stores rather than through big box retailers. Brainy
Baby has consciously avoided these mass market retailers which erode image,
pricing and margins and pull the customer base from the smaller, high-end
stores. The company has not invested in marketing efforts Direct-To- Consumer
(DTC) because of lack of access to investment capital.
Therein lies the opportunity for Brainy Brands.
Company Overview
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Market Overview
Fueling sales growth are four primary groups:
1) New parents who have a high interest in seeing that their children receive an early learning
advantage
advantage
2) The parents of toddlers that seek a few guilt free moments of quiet for themselves
3) Parents of children with learning disabilities such as dyslexia and autism, who find their
children are positively and profoundly impacted by Brainy Baby DVDs
children are positively and profoundly impacted by Brainy Baby DVDs
4) Grandparents who often outspend parents. Educational "Baby Videos" have increased
1000% in revenues over the last five years and has now reached more than $1.3 Billion in
sales annually.
1000% in revenues over the last five years and has now reached more than $1.3 Billion in
sales annually.
(Sources: Forbes Magazine, VSDA, VideoScan and AC Neilson)
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Market Overview
Traditionally, the market has been dominated by 2 channels of distribution:
•The Mass Market
i.e. Wal-Mart, Target, Costco, etc.
• The Specialty Market
High end retail stores, specialty department store chains, privately owned toy stores,
book stores which sell products which are not normally found in the Mass Market
book stores which sell products which are not normally found in the Mass Market
The advent of the internet and the revolution of interactive technology and communication has
disrupted the marketplace and as result, Direct To Consumer (DTC) is rapidly becoming a
significant factor in distribution and market share
disrupted the marketplace and as result, Direct To Consumer (DTC) is rapidly becoming a
significant factor in distribution and market share
The recent DTC commercial success of “Your Baby Can Read” has validated the concept of Direct To
Consumer sales for this category. “Since its launch in April of 2008, 400,000 units have been sold via
Direct TV, 400,000 units have been sold on line, and 100,00 units have been sold via normal retail
channels”(1). At YBCR’s $199.99/ unit selling price, that translates to $180,000,000 in sales. YBCR has
opened the door for an aggressively marketed DTC initiative supporting a superior product backed by a
University Study to be highly successful.
Consumer sales for this category. “Since its launch in April of 2008, 400,000 units have been sold via
Direct TV, 400,000 units have been sold on line, and 100,00 units have been sold via normal retail
channels”(1). At YBCR’s $199.99/ unit selling price, that translates to $180,000,000 in sales. YBCR has
opened the door for an aggressively marketed DTC initiative supporting a superior product backed by a
University Study to be highly successful.
(1) Response Magazine: 2010 Direct Response Marketing Assoc.
Marketer of the Year Nomination
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Children's education and entertainment products are one of the fastest growing
segments of the $4.8 billion children's video and DVD market, of which the non-theatrical
segment is $1.3 billion annually1.
segments of the $4.8 billion children's video and DVD market, of which the non-theatrical
segment is $1.3 billion annually1.
•In the last five years, the industry has come to recognize the greater potential of the
Infant and Preschool markets.
•Education/Entertainment market - The number of DVD titles, computer games, electronic toys,
animated characters and television programs, which provide preschoolers with educational
content, are growing at an unprecedented rate.
animated characters and television programs, which provide preschoolers with educational
content, are growing at an unprecedented rate.
•The preschool market is expected to continue strongly through year 2025 and beyond.
•Parents and grandparent worldwide desire to give their children a head start with greater
educational opportunities.
educational opportunities.
•With more than 4.1 million new babies born annually in the United States2 and with early
education emphasized worldwide, the industry has proven to be recession-resistant.
education emphasized worldwide, the industry has proven to be recession-resistant.
1 MarketResearch.com 2 CDC.gov/nchs/fastats/births.htm
Market Overview
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Young Children’s Media Landscape
• Children use electronic media 2-5 hours daily
• More time with television than any other single activity except sleep
• Explosion of products marketed to the very young
• Baby Einstein, Baby Mozart
• Computer “Lapware”
• Preschool Video Games
Yet, we knew relatively little about the impact of this use.
The vast majority of existing work focused on older children.
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Can infants and toddlers learn a novel shape from video?
Brainy Baby “Shapes & Colors”
Electronic Media in Young Children’s Lives
A Study by
Elizabeth A. Vandewater
Public Health and Environment
Research Triangle Institute
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Study Design
• Post-test only design
• Novel shape - the crescent
• Randomly assigned to one of two conditions:
– Experimental : 10 minutes with Brainy Baby’s Baby Shapes 1 DVD - lessons on circles,
squares, rectangles, triangles and crescents
squares, rectangles, triangles and crescents
– Control : 10 minutes with the same DVD - lessons on crescents replaced with video of
toys dancing
toys dancing
• Community Sample
– Austin, TX and surrounding areas
• Descriptive Statistics
– Age range 18 to 33 months
– 57% Boys, 43% Girls
– Avg. Family Monthly Income = $ 6,208
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Study Procedure
• Children watched the video at home
– Parents were asked to show children the video a minimum of 5 times per week
for a three week period
for a three week period
• Children were brought to the lab for testing
– Roughly 5 minute warm-up period
– 3 minute refresher video clip from the research video
– Identifying shapes for the experimenter by pointing them out in a picture book
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Major Findings
• Experimental group was 22 times more likely to identify the crescent
than the control group
than the control group
• No difference between the groups on children’s ability to identify any
other shapes
other shapes
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Differences in Shape Recognition for Whole Sample
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Differences in shape recognition for children
under 24 months old for the Whole Sample
under 24 months old for the Whole Sample
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The dominant competitor, and closest comparable to Brainy Baby is Disney's Baby Einstein.
Key Highlights:
Competitive Set
• In 1999, Baby Einstein’s revenues were reportedly $3 million dollars
• The company received a $2 million investment to expand their product line,
increase marketing and sales campaign initiatives
Within 18 months, Baby Einstein increased sales to $17 million
ü A year later Disney purchased Baby Einstein for a reported $25 million
üThree years later Disney generates over $230 million in revenue, plus additional
profits from toys, licensing and other ancillary products is estimated to be over $50
million. 3
profits from toys, licensing and other ancillary products is estimated to be over $50
million. 3
Other competitors include Leapfrog®, which has a reading program for children ages 4-8. This
company has developed a strong presence in the market and could be viewed as a strong
competitor although Leapfrog products are not DVDs.
company has developed a strong presence in the market and could be viewed as a strong
competitor although Leapfrog products are not DVDs.
The balance of the companies in the category are very small with limited offerings
and negligible market share
and negligible market share
3 http://en.wikipedia.org/wiki/Baby_Einstein
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Market Opportunity
Recently, Baby Einstein's product line has received high profile public criticism as result of several
studies that concluded that the product provides no measurable educational benefit to children. As a
result, loss of share and distribution has been significant.
studies that concluded that the product provides no measurable educational benefit to children. As a
result, loss of share and distribution has been significant.
Brainy Baby remains in the top three brands according to AC Neilson studies. Brainy Baby has been
ranked as the second most popular brand by Amazon.com consumers, who are eager to buy
educational preschool products. The company is poised to exploit the opportunity with its acclaimed and
highly respected product line up.
ranked as the second most popular brand by Amazon.com consumers, who are eager to buy
educational preschool products. The company is poised to exploit the opportunity with its acclaimed and
highly respected product line up.
üMarket disruption as result of the Baby Einstein issue has provided a window of opportunity for
significant gain.
significant gain.
üConsumers and retailers are actively seeking product(s) that will meet their high
standards for providing high quality educational value to young children
ü Independent university studies acclaim Brainy Baby as a superior educational product,
beneficial to children
beneficial to children
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In a major broadcast media and Public Relations event Brainy Baby will provide empirical evidence of the
effectiveness of Brainy Baby products.
effectiveness of Brainy Baby products.
An embargoed but soon to be released university tested, scientific control group study will reveal
exceptionally high test results validating the content and teaching methodology used in Brainy Baby's
videos. The study will show that, as compared to the control group, toddlers between 18 and 24
months, in the experimental group, were 22 times more successful identifying the test objects in
a book after being exposed to the subject in the DVD. The test also confirmed that after exposure
to the DVD, the test object could be recognized in other traditional 2-dimensional media.
exceptionally high test results validating the content and teaching methodology used in Brainy Baby's
videos. The study will show that, as compared to the control group, toddlers between 18 and 24
months, in the experimental group, were 22 times more successful identifying the test objects in
a book after being exposed to the subject in the DVD. The test also confirmed that after exposure
to the DVD, the test object could be recognized in other traditional 2-dimensional media.
The study will further validate what mothers around the globe have been telling the company through
thousands of unsolicited testimonials for over 10 years: The products work and they love what it does for
their children. This includes a disproportionately high number of letters from the grateful parents of
special needs children.
thousands of unsolicited testimonials for over 10 years: The products work and they love what it does for
their children. This includes a disproportionately high number of letters from the grateful parents of
special needs children.
Brainy Baby's unique product designs quality educational content out-performs the competition due to
reality-based (as opposed to character or cartoon based) presentation of the content. i.e. Baby Einstein.
reality-based (as opposed to character or cartoon based) presentation of the content. i.e. Baby Einstein.
Brainy Baby® offers high quality educational content which supplies and reinforces lasting knowledge
through its time tested teach and repeat methodology. Their Learning Library system provides a
comprehensive educational line that builds and extends equity in the Brainy Baby brand through an
extensive Licensing Program that currently extends into Toys, Books, Games, Apparel and other related
products.
through its time tested teach and repeat methodology. Their Learning Library system provides a
comprehensive educational line that builds and extends equity in the Brainy Baby brand through an
extensive Licensing Program that currently extends into Toys, Books, Games, Apparel and other related
products.
Impending Research Release
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Topline Analysis
Brainy Baby has historically built its business and its reputation thru the development of content
and the sale of videos. It has made significant inroads in broadcast licensing and as result the
franchise is well known and respected. Any of the limited experiences the company has had with
the licensing and sale of toys has been highly successful.
and the sale of videos. It has made significant inroads in broadcast licensing and as result the
franchise is well known and respected. Any of the limited experiences the company has had with
the licensing and sale of toys has been highly successful.
•Mass/ Big Box channels have treated DVD’s as a commodity and as a result margins once
profitable are shrinking.
profitable are shrinking.
•Recent economic trends have decimated the smaller specialty shops who can not match pricing w/
the mass channel
the mass channel
•Direct to Consumer TV has proven extremely effective (higher margins, quicker response,
better cash flow), significant volume
•As result of technological advances in the price and delivery of content, all channels are seeking
the extra volume and value of toys.
While Mass and Specialty channels (Brick & Mortar) will always be important to the
Company’s efforts, the industry is approaching an inflection point at which DTC
(on line and interactive TV) represent the largest and quickest potential.
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Primary Strategy: Direct to Consumer
} Focus & Invest in Direct to Consumer Channel- Direct Response TV Advertising and Continuity Program
(ala ‘Your Baby Can Read’)
} On Line Channel- E-commerce, search, email, social media, affiliate marketing
Secondary Strategy: Retail/ Brick & Mortar
} Refresh Product lines, optimize video line is Specialty Channel
} Approach Mass/ Big Box w/ private label video program
} Develop/ Revamp and introduce toy lines to apply to all channels
Strategic Initiative: Alternative Channel
} Develop and test holiday season mall kiosk program that if successful will roll N/W holiday season 2011
} Develop and Aggressively market Mobile Apps (w/in primary strategy/ currently rolling out)
Strategy
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Founder, Chairman, Chief Creative Officer - Dennis Fedoruk
Dennis' background and education in film and cinematography naturally equipped him to
produce the awarded winning family of Brainy Baby products. In his previous company he had
created industrial training videos, television commercials and corporate communication media
for more than 15 years. Constant request from friends and family for copies of the early
childhood educational videos he had developed for his own children created demand for the
product. He quickly recognized an opportunity to fill a need with his creations and launched
what has become a $1.2 billion/yr baby video industry in1995 when he created Brainy Baby.
produce the awarded winning family of Brainy Baby products. In his previous company he had
created industrial training videos, television commercials and corporate communication media
for more than 15 years. Constant request from friends and family for copies of the early
childhood educational videos he had developed for his own children created demand for the
product. He quickly recognized an opportunity to fill a need with his creations and launched
what has become a $1.2 billion/yr baby video industry in1995 when he created Brainy Baby.
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Chief Executive Officer - John Benfield
John’s career began with the Colgate-Palmolive Company in 1975 where his experience Included
Field Sales and Key Account Management, years in various brand management, general
marketing and management responsibilities. When he left Colgate in 1989 he was the Director of
New Business for Colgate U.S.
Field Sales and Key Account Management, years in various brand management, general
marketing and management responsibilities. When he left Colgate in 1989 he was the Director of
New Business for Colgate U.S.
From Colgate, he joined CoActive Marketing Group’s privately held predecessor company, R.G.
Meadows, Inc., a Top 3 US Promotional Radio and Marketing Firm in 1989 as Executive Vice
President of Operations . In 1990 he became Chief Operating Officer. He was named President
in 1992 and led the company through an LBO in March of 1995 and brought it public (NASDAQ
Small Cap CMKG) as its President, Chief Executive Officer and Director in September of 1995. In
October of 1996, John was named as Coactive Marketing Group, Inc. Chairman of the Board and
remained until 2006. After leaving CoActive Marketing Group in 2006, John cofounded Wall &
Madison LLC., a marketing and management consultancy.
Meadows, Inc., a Top 3 US Promotional Radio and Marketing Firm in 1989 as Executive Vice
President of Operations . In 1990 he became Chief Operating Officer. He was named President
in 1992 and led the company through an LBO in March of 1995 and brought it public (NASDAQ
Small Cap CMKG) as its President, Chief Executive Officer and Director in September of 1995. In
October of 1996, John was named as Coactive Marketing Group, Inc. Chairman of the Board and
remained until 2006. After leaving CoActive Marketing Group in 2006, John cofounded Wall &
Madison LLC., a marketing and management consultancy.
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Vice President & COO - Ronda Bush
Ronda is general operations and finance manager for the company and began working with the
founder over 18 years ago. Ronda worked with Dennis Fedoruk running accounting and
operations at SPI Visual communications group, a company which produced industrial training
videos, television commercials and corporate communication media for companies such as
Delta Airlines, Coca Cola, HBOC and many smaller firms. Dennis then formed Small Fry
productions which produced the successful Baby's First Impressions series in 1995 out of which
grew the Brainy Baby company in 2000. Ronda's extensive hands on involvement in operations
from its inception, her knowledge of the intricate details and complexities of the company’s 200
SKUs and 30 international distributors, uniquely qualified her to be COO, a position she has
now held for over 10 years. Prior to joining SPI, Ronda had her own company Fiscal Integrity
where she provided accounting services for a number of different small companies.
founder over 18 years ago. Ronda worked with Dennis Fedoruk running accounting and
operations at SPI Visual communications group, a company which produced industrial training
videos, television commercials and corporate communication media for companies such as
Delta Airlines, Coca Cola, HBOC and many smaller firms. Dennis then formed Small Fry
productions which produced the successful Baby's First Impressions series in 1995 out of which
grew the Brainy Baby company in 2000. Ronda's extensive hands on involvement in operations
from its inception, her knowledge of the intricate details and complexities of the company’s 200
SKUs and 30 international distributors, uniquely qualified her to be COO, a position she has
now held for over 10 years. Prior to joining SPI, Ronda had her own company Fiscal Integrity
where she provided accounting services for a number of different small companies.
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![](https://capedge.com/proxy/8-KA/0001013762-11-000423/ex3_426.jpg)
Carson B. Ashworth
VP National Sales- Mass, Chain, Specialty
Carson has over (35) years experience as a sales management professional. Developed a
nationwide mall kiosk program for Healthrider Fitness Company, opening 275 kiosk’s, increasing
sales from $5-million to over $275-million in 3.5 years. Hired & Trained (20) Regional Managers
and developed a kiosk retail sales organization of over 1,200 managers, assistant managers, and
sales associates. Was the top producing Senior Loan Officer with a national mortgage company
for (10) years managing (25) Loan Officers and generating in excess of $7.5 million in personal
loan origination per month, plus $37.5 million per month from the Loan Officers production. Years
of experience in new business growth and retention, organizing national sales teams, sales
training, sales recruiting, goal setting and strategic thinking.
nationwide mall kiosk program for Healthrider Fitness Company, opening 275 kiosk’s, increasing
sales from $5-million to over $275-million in 3.5 years. Hired & Trained (20) Regional Managers
and developed a kiosk retail sales organization of over 1,200 managers, assistant managers, and
sales associates. Was the top producing Senior Loan Officer with a national mortgage company
for (10) years managing (25) Loan Officers and generating in excess of $7.5 million in personal
loan origination per month, plus $37.5 million per month from the Loan Officers production. Years
of experience in new business growth and retention, organizing national sales teams, sales
training, sales recruiting, goal setting and strategic thinking.
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SVP/ Licensing, International & Broadcast - Jerry Bush
Jerry manages both domestic and international licensing, reseller, distribution channels,
duplication and broadcast licensing; crafts and negotiates licensing and strategic partner
contracts; business plan development and strategic planning for the company and partner
relationships. Jerry's background includes 25 years of executive sales positions in high dollar
information systems and capital equipment producing over $100mm revenue with an array of
Clinical, Financial, Laboratory, Radiology, Computerized Patient Record, (HIS) Hospital
Information Systems where he sold into healthcare's largest (IDNs) Integrated Delivery Networks
as well as CAD/CAM systems into aerospace and architecture in the early 80’s for the industry's
leading solution providers. With his background in design and manufacturing, Jerry was awarded
patents for products he developed, one of which is directly related to the infant market.
duplication and broadcast licensing; crafts and negotiates licensing and strategic partner
contracts; business plan development and strategic planning for the company and partner
relationships. Jerry's background includes 25 years of executive sales positions in high dollar
information systems and capital equipment producing over $100mm revenue with an array of
Clinical, Financial, Laboratory, Radiology, Computerized Patient Record, (HIS) Hospital
Information Systems where he sold into healthcare's largest (IDNs) Integrated Delivery Networks
as well as CAD/CAM systems into aerospace and architecture in the early 80’s for the industry's
leading solution providers. With his background in design and manufacturing, Jerry was awarded
patents for products he developed, one of which is directly related to the infant market.
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Loren Taylor has thirty years of experience in the manufacturing and marketing
of children’s products. He has spent the last twenty four years in the toy and gift
industries, developing and managing many very successful lines. He has worked
for six companies in four industries, ranging in size from start up to well over 1 billion dollars.
These companies include: Lever Brothers Inc., Lifesavers Inc., Mattel Inc., Applause Inc.
and Hasbro Inc. His most recent corporate position was General Manager of the Big Kids
Division of the Hasbro Toy Group. Mr. Taylor has an MBA from Rutgers University.
Management Team
Loren Taylor
Senior Advisor- Product Development - Toys, Puzzles, Games
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This table is subject to important
assumptions, risks and uncertainties, which
are difficult to predict and therefore the
actual results may be materially different
from those presented. No assurances can
be given that such revenues or net
earnings will be achieved. All statements in
this table are forward-looking statements
based on the objectives of management
using various assumptions in connection
with its future financial position and future
operations, as well as assumptions relating
to the future condition of outside variables
such as the operating environment,
economies and markets in which the
Brainy Brands Company, Inc. operates.
The nearby table is predicated on an
assumption of 9/30/10 funding.
assumptions, risks and uncertainties, which
are difficult to predict and therefore the
actual results may be materially different
from those presented. No assurances can
be given that such revenues or net
earnings will be achieved. All statements in
this table are forward-looking statements
based on the objectives of management
using various assumptions in connection
with its future financial position and future
operations, as well as assumptions relating
to the future condition of outside variables
such as the operating environment,
economies and markets in which the
Brainy Brands Company, Inc. operates.
The nearby table is predicated on an
assumption of 9/30/10 funding.
Sales | ||||||||
1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter | 2011 | 2012 | 2013 | ||
On-Line/ Ecomerce | $100,000 | $225,000 | $275,000 | $350,000 | $950,000 | $1,625,000 | $3,000,000 | |
iPhone, iPad apps | $175,000 | $175,000 | $175,000 | $175,000 | $700,000 | $700,000 | $700,000 | |
Direct Response TV | $900,000 | $900,000 | $900,000 | $900,000 | $3,600,000 | $17,000,000 | $32,500,000 | |
Total DTC Sales | ||||||||
Mass/ Specialty/Chain | $100,000 | $80,000 | $1,000,000 | $1,100,000 | $2,280,000 | $5,500,000 | $12,000,000 | |
Specialty | $60,000 | $140,000 | $250,000 | $350,000 | $800,000 | $800,000 | $1,500,000 | |
Kiosk | $76,725 | $0 | $0 | $0 | $76,725 | $2,500,725 | $6,500,000 | |
Total Retail | $236,725 | $220,000 | $1,250,000 | $1,450,000 | $3,156,725 | $8,800,725 | $20,000,000 | |
Total Licensing | $100,000 | $150,000 | $200,000 | $200,000 | $650,000 | $1,250,000 | $3,200,000 | |
Total Sales: | $1,511,725 | $1,670,000 | $2,800,000 | $3,075,000 | $9,056,725 | $29,375,725 | $59,400,000 | |
Expenses | ||||||||
On-line Media | $50,000 | $137,500 | $137,500 | $187,500 | ||||
Ad Words | $50,000 | $50,000 | $50,000 | $100,000 | ||||
Direct Response TV test | $0 | $0 | $0 | $0 | ||||
Direct Response Long Form | $0 | $0 | $0 | $0 | ||||
DRTV Media | $300,000 | $300,000 | $300,000 | $300,000 | ||||
DRTV Commissions | $30,000 | $30,000 | $30,000 | $30,000 | ||||
Public Relations | $30,000 | $30,000 | $30,000 | $30,000 | $150,000 | |||
Toy Manufacturing Cost | $0 | $50,000 | $750,000 | $750,000 | ||||
Costs of goods (DVD's & Books) | $196,759 | $216,000 | $240,000 | $266,250 | $6,630,000 | |||
Kiosks Test | $31,800 | $0 | $0 | $0 | $42,400 | |||
Kiosks Management | $0 | $0 | $0 | $3,542,400 | ||||
Product Line Refreshment & Redesign | $0 | $0 | $0 | $0 | $0 | $221,000 | ||
Trade Shows | $55,000 | $50,000 | $0 | $0 | ||||
Accounting Staffing | $12,250 | $12,250 | $12,250 | $12,250 | $300,000 | |||
Legal Fees | $21,489 | $21,489 | $21,489 | $21,489 | $400,000 | |||
Audit Fees | $10,000 | $10,000 | $10,000 | $10,000 | ||||
IT Consulting | $4,500 | $4,500 | $4,500 | $4,500 | ||||
Warehouse Management | $3,900 | $3,900 | $3,900 | $3,900 | ||||
Web-Master | $375 | $375 | $375 | $375 | ||||
DRTV Consultant(s) | $15,000 | $15,000 | $15,000 | $15,000 | ||||
$9,000 | $9,000 | $9,000 | $9,000 | |||||
$76,514 | $76,514 | $76,514 | $76,514 | |||||
Payroll w Tax | $283,927 | $283,927 | $283,927 | $283,927 | $2,153,000 | |||
Contract Labor | $7,563 | $7,563 | $7,563 | $7,563 | $30,250 | |||
Travel & Entertainment | $14,953 | $14,953 | $14,953 | $14,953 | $375,000 | |||
Rent & UtilitiesExpense | $18,676 | $18,676 | $18,676 | $18,676 | $82,362 | |||
Computer and Internet Expenses | $5,154 | $5,154 | $5,154 | $5,154 | $20,617 | |||
Repairs and Maintenance | $4,399 | $4,399 | $4,399 | $4,399 | $17,596 | |||
Telephone Expense | $7,455 | $7,455 | $7,455 | $7,455 | $29,818 | |||
Insurance Expense | $10,027 | $10,027 | $10,027 | $10,027 | $40,827 | |||
UPS | $7,503 | $7,503 | $7,503 | $7,503 | $225,000 | |||
General Expenses (Combined) | $123,347 | $123,347 | $123,347 | $123,347 | $493,388 | $600,000 | $893,386 | |
$483,004 | $483,004 | $483,004 | $483,004 | $1,932,016 | $2,425,981 | $3,867,856 | ||
Total Expense | $1,303,077 | $1,423,018 | $2,247,018 | $2,373,268 | $7,346,381 | $23,787,140 | $48,493,656 | |
EBITDA | $208,648 | $246,982 | $552,982 | $701,732 | $1,710,344 | $5,588,585 | $10,906,344 | |
% Sales | 13.8% | 14.8% | 19.7% | 22.8% | 18.9% | 19.0% | 18.4% |
![](https://capedge.com/proxy/8-KA/0001013762-11-000423/ex3_431.jpg)
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The Brainy Brands Company