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Ib2 c due diligence report

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  • 1. DUE DILIGENCE REPORT Benjamin J. Garber 18 November 2010 Prepared for BlueTree Capital Group | BlueTree Allied Angels
  • 2. Due Diligence Team  Kirk Vincent  David Charlton  Dwayne Bucko  Jenny Karlsson  Jason Matzus  Ben Garber
  • 3. Company  Intimate Bridge 2 Conception (Ib2C) is a medical device company focused on fertility  Initial sales driven online and through infomercials  Ib2C is hoping to raise $1.5MM this round  CEO, Steve Bollinger  Market Advisors, Messrs. Swenson & Tovian  Medical Advisors, Drs. Pelekanos & Hoffman  Legal Advisors, Foley Hoad LLP
  • 4. Company  Intimate Bridge 2 Conception (Ib2C) is a medical device company focused on fertility  Initial sales driven online and through infomercials  Ib2C is hoping to raise $1.5MM this round  CEO, Steve Bollinger  NO FEMALE PRO DUCT O R MARKET ADVISO RS
  • 5. Product  Focus Touch Kit is a cervical cap devise featuring a unique delivery method
  • 6. Key Considerations  No indication of market acceptance  No prototype or claim of product efficacy  No Freedom to Operate Study  Large market potential  Few competitors
  • 7. Problem  7.3MM women in the U.S. and 100MM+ worldwide having trouble conceiving  1.2MM in the U.S. are actively seeking assistance  Existing IUI and IVF treatments are costly, invasive, uncomfortable, and unnatural
  • 8. Solution  The Focus Touch Kit is:  Inexpensive at $80 (IUI is $2k and IVF is$20k)  Do-it-yourself low technology devise; no surgery  Used within the privacy of your own home  Reduces stress associated with conception  Hormone free utilizing natural mechanical techniques
  • 9. Sales  BlueTree investment will primarily be allocated to product and strategy refinement and initial marketing efforts  Internet search marketing powered by GoogleAdwords... later social media, Yahoo, Bing  Infomercials supported by GoogleTV
  • 10. Sales  BlueTree investment will primarily be allocated to product and strategy refinement and initial marketing efforts  Internet search marketing powered by GoogleAdwords... later social media, Yahoo, Bing  Infomercials supported by GoogleTV  $4.2MMmarketing expense budgeted forfirst 200,000 unit sales represents the lowerbound
  • 11. Forecasts  Pending 510(k) approval in Q3 2011  25,500 units IN Q3/Q4 2011 (6,375 customers) for revenue of $2.04MM  $12.5MM in 2012 to $22.5MM in 2013  OTC and international launch
  • 12. Forecasts  Pending 510(k) approval in Q3 2011  25,500 units IN Q3/Q4 2011 (6,375 customers) for revenue of $2.04MM  $12.5MM in 2012 to $22.5MM in 2013  OTC and international launch  Riskthat sales will not accelerate as anticipated and Ib2C will need additional capital potentially diluting BlueTree’s interest
  • 13. Document Review  Terms offered to BlueTree are same as PLSG including convertible promissory note and warrants  Received $200k from IW and $275k from PLSG  If the company sells for $20MM, PLSG would receive $1.55MM for it’s $275k in notes  PLSG conversion to 450k or 580k shares based on $4.5MM and $2.5MM valuations
  • 14. Internet Marketing

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