EXHIBIT 99.7
FOR IMMEDIATE RELEASE
Contact: Fell Herdeg
Telephone: 203-846-2274
Facsimile: 203-846-1776
fell.herdeg@soundprints.com
TRUDY ANNOUNCES CONVERSION OF PRINCIPAL SHAREHOLDERS' DEBT TO EQUITY
Norwalk, Connecticut, July 7, 2006--Trudy Corporation (OTCBB:TRDY.OB) announced
today the Board of Directors authorization and approval of a proposed conversion
by Mr. William W. Burnham and Mrs. Alice B. Burnham of their loans to the
Company, plus accrued interest, into shares of Common Stock of the Company. The
Board provided the Burnhams with a deadline of July 15, 2006 by which to elect
such conversion and the Burnhams have informed the Company they wish to make
such conversion at once.
The Independent Committee of the Board of Directors was charged with formulating
an opinion as to the price at which the Burnhams should be allowed to convert
their loans and accrued interest to equity. In reaching its conclusion the
Committee relied upon the following sources of information:
a. The Company's past financials, its current financial position,
and an understanding of the Company's prospects for the coming
fiscal year 2007;
b. Valuation information made generally available by the media
and a number of business brokerage sources in the publishing
industry;
c. Judgment based on many years of experience in the publishing
industry;
d. A review of the average price of Trudy common stock over the
past 30, 60 and 90 days;
Based upon a combination of the above items and reasonable judgment, the
Independent Committee proposed that the Burnham loans and accrued interest be
converted to Trudy Common Stock at a price of $0.01 per share, and the Board of
Directors of Trudy unanimously approved such conversion price, Mr. and Mrs.
Burnham having recused themselves from voting.
The below table summarizes the loans and accrued interest that was converted on
July 7, 2006 based on principal and accrued interest balances as of July 7,
2006.
Accrued
Individual Position Debt Interest Total
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Mr. William Burnham Chairman of the Board,
Director of Corporate
Development, principal shareholder $ 825,664 $ 22,321 $ 847,985
Mrs. Alice Burnham Director, principal shareholder 454,000 102,338 556,338
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Total: $1,279,664 $ 124,659 $1,404,323
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The conversion of debt and accrued interest at $0.01 will create approximately
140 million newly issued shares of common stock out of the 850 million shares
authorized. These shares, when added to the 458 million fully diluted current
shares outstanding, will yield a new total shares issued and outstanding of
approximately 598 million. After the conversion, the Burnham family will own 316
million shares of Trudy common or 52.8% of the common shares issued and
outstanding.
Except for the historical information contained herein, the matters set forth in
this press release are forward-looking statements within the meaning of "safe
harbor" provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements are subject to risks and uncertainties that may
cause actual results to differ materially. These forward-looking statements
speak only to the date hereof; Trudy Corporation disclaims any intent or
obligation to update these forward-looking statements.