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Proprietary & Confidential B&B TECHNOLOGIES MANAGEMENT SUMMARY From the CEO of B&B Technologies and the General Partner of the DAMPS I Ltd. Partnership, Jeffrey W. Brown. I would like to introduce the merits of a patented and revolutionary, "Opposing Super Magnet Footwear Technology, Private Equity Offering." I am the worlds first expert on opposing super magnet footwear technology. When I say "super magnets," I am discussing magnets 38 times more powerful than any magnet you have likely handled before. In opposition, the magnetic polarity creates a real shock reducing suspension/propulsion technology. These magnets are placed in the heel of newly engineered footwear, to substantially reduce shock suspension and add real propulsion. The Biomechanics A 200 Ib. person puts as much as 600 p.s.i. on their heel every step. That translates to tons of kinetic load force each and every day. That shock is felt on every part of the body. The body and productivity suffers. Our magnetic technology reduces that shock by over 90% each and every step. That is virtually a shock free footwear technology! A person is literally floating on the opposing suspension polarity field created between the super magnets. If you have any specific questions, speak with our consulting podiatrist. Proposed Funding My company B&B Technologies, has been doing advanced footwear technology R&D and is looking for $ 150,000/$ 500,000/ $ 5.2 mil., in management progressive funding, for our current R&D to first stage manufacturing transition. Initial Investments would be a Private Equity Offering, in the DAMPS I Ltd. Partnership. Either a Limited Partner or a General Partner could be added. I am the only General Partner to date. All 25 investors are Ltd. Partners. Funding Options The partnership at the appropriate time, can discuss IPO options and/or readily exchange DAMPS I Partnership equity for corporate stock. This possible evolution has already been proposed and considered by the partnership. Value Added Funding Every funding step make is added value for this project, which already has been independently valued between $ 2.4 - $ 1 1 mil. B&B Technologies LP received a $ 6.5 million funding offer in Jan. 1997. That offer was unanimously rejected by the Limited Partners and the General Partner. Valuation Update What Does the Partnership want from a Funding Partner? We are looking for a California funding Partner that can be comfortable, even excited with this high risk-high return investment, for five years. The true innovation and viability must be recognized. One of a Kind Patented Magnetic Technology We have patented and prototyped a revolutionary opposing super magnet, suspension/propulsion footwear technology for professional working and walking shoes. The technology called DAMPS ( Directional Axial Magnetic Propulsion Systems ), reduces conventional dynamic kinetic motion shock by over 90%, each and every step. We have worked with a consulting podiatrist, starting day one. Substantial shock reduction is a real health and productivity benefit. "At 4:30 a person wearing DAMPS Technology Footwear, is not just dragging around a logo." Professional Working and Walking Footwear With low back problems the number two cause of employee down time (s. Parade ) and noting that Reebok noted a study detailing 85% of all athletic shoes are used for non-athletic purpose, makes our market demographics dead on for this 21 st century Technology. The athleisure walking market is one of strongest growing, footwear segments. The working market is huge. B&B Technologies and its' management team will manufacture market and distribute a total of 3.3 mil. shoes, over a five year period. Beginning with 1 1 0,00 units year one ramping to 1.2 million units in year five. Who is B&B Technologies? As CEO, I learned about the foot and Biomechanics after recovering from breaking my foot in a motorcycle accident. I invented the technology and managed B&B Technologies with this project, since 1988. The R&D funding to date has been via a CA Reg. D Rule 506 Ltd. Partnership with 25 investors to date. In preparation for future institutional funding, all limited partner investors have provided a "risk sign off," as of 8/15/97. The B&B Technologies Management Team We have an experienced senior management team, that has just placed the former VP of Manufacturing for Red Wing Shoes to our investment-management team, ( 10/25/97 ). Well over 50 years of footwear industry experience, launching the future of footwear technology. We also have a 30 year, former US manufacturer of women's shoes, consulting for the management team.. I have spoken with over 20 professionals in the last two years. All are very excited about this innovation. Price Plus- Our technology shoe sells at under $ 100 ( with later footwear options to increase that price ), Made in the USA & the technology shoe is designed to be Fully Recyclable. People recognize magnetic technology in their first steps. Seven technology Prototypes have been engineered and demonstrated to date. Management can sell the sizzle and we call the steak "the DAMPS One Step Difference." There is nothing in the world like it. RISK & Performance As a manager, I learn a lot by trying to put myself in the other person shoes-no pun intended. I have spoken with hundreds of financial people. My investors and myself understand risk, and yet always believed in the technology's real viability. After eight years, financially we believe that the potential outweighs the risk, strongly. How much value can you place on 9 years of R&D when Nike spends an average of $ 18 million a year. Substantial risk has been removed by management during the past eight years. Yes we understand the risk of an "unproven product." It comes down to either you believe we can manage, manufacture and market this innovative technology shoe or not. I think you know my position. Footwear Technology in the Footwear Industry The "value" of past "footwear technology," is documented and it is substantial. Everything from Air, the Pump, the Gels, the Lights etc. Management has showcased our technology results in a dynamic product, that will be changing the $50 billion world wide footwear industry's, ( $ 12- $ 15 billion US domestic ). All management next steps add real value to the technology and this project, and with industry licensing ( dual ) viable. We Have Strong Interest There is strong multi-industry, marketing and retailing interest, including NATICK RD&E, U.S. Military, which has requested DAMPS technology prototypes for a special "Smart Boots" program. Our projections on this venture attaining a less than 1 % market share ( US Domestic ) in five years, projects sales of over $ 120 mil. with over $ 45 mil. in pretax net earnings in five years. Current management also notes the real potential of demand, to far exceed projections. $ 150,000/$ 500,000/$ 5.2 mil. Progressive Management Funding Current Investment is in the DAMPS I Partnership as equity. Based on our current management funding time line, beginning initially with $ 150,000, we can produce and assemble our first technology production mold ( size 11 ) shoes for testing and marketing. To be produced in limited short runs in six months (25 pairs to start testing ). The next $ 500,000 step will implement core management and variable size molds ( 8-12 ) for further production and ISO 9002 QC Testing, Biomechanics Testing and marketing. $ 5.2 will implement full management, manufacturing ( including $1.5 mil. in capital equipment ), and marketing, as per our five year business plan and projections. The Competition The footwear industry is very competitive however management believes that our dedicated niche marketing/distribution strategy, experienced management, working with this patented, one of kind technology innovation, offers very strong avenues for success. There is a proven track record of successful technology introduction within the industry. The Future Ultimate international marketing and management prepares for a $ 100 million credit line, to handle expansion and aggressively pursue world wide market share. B&B Technologies Markets a Superior Technology
Product, ISO 9002 is the most advanced manufacturing technology systems and technology product standards in the world As CEO, I can tell you that we will market no technology shoe before its time. We are offering the consumer "the Technology of a Ferrari-Priced like a Corvette. " For shock reduction technology, no shoe will be able to touch us and wait and hear about our future R&D. I believe you will find the project matched for the challenge. Valuation Added Another investment management plus, relates to the dual licensing product created. As current management ramps up to ISO 9002 manufacturing, business valuation will go up exponentially and the value of licensing would now double. When the footwear industry later plans to license the technology, the secondary proprietary manufacturing licensing rights also are applicable. We implement proprietary technology and proprietary technology manufacturing production and distribution with our strategic marketing ramp up. This is a beneficial technology that makes so much sense. Funding Time Line Private Placement Funding allows for production of our first production mold and short runs for testing, allows for a six month time window. With a full funding guarantee of $ 5.2 mil., eighteen months to full manufacturing capabilities and implementation. Further management ramp up strategies can by discussed at appropriate levels. Our Partnership attorney or Partnership CPA of Record, may be scheduled. We can discuss the requirements of all fund and/or funding exit strategies. Bottom Line I am not currently aware of your total and/or combined investment parameters, however as it all seems to be with new technology, everybody wants one. I look forward to future discussion, regarding investment interest. We are looking for a funding partner that recognizes and respects the technology, the management and its viability. Next century managers can look aggressively beyond the first labels of "risk and even higher risk," to realize the prudent value of management, the Proprietary R&D to date and the ultimate viability and opportunity with this revolutionary new technology. Everything about this project is magnetic. This material has been prepared by the Company described and is being distributed by B&B Technologies LP to Qualified Investors in furtherance of the purposes set forth in its bylaws. Management has participated in the preparation of this executive summary and makes any representation or warranty as to the accuracy or completeness of the information contained herein. This summary is not an offer to sell securities nor a solicitation of an offer to buy securities. If you have any questions, please call and/or consult a professional. |
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