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Author: ProfitSearcher Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76  
Subject: KIDE Annual Meeting Date: 5/17/2000 7:27 PM
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Folks, you had to be there. The main presentation was primarily things KIDE Investors already know....but the tidbits that slipped through were absolutely awesome. (For example, KIDE has been meeting with this tiny little no-name company called LUCENT (!!!!) to help them adapt their technology to the toy market.) There's also no way to convey the excitement of all the trailers we saw for the new products. These a pretty much my raw notes, but if you read between the lines, you're looking at one phenomenal business model.

Annual Meeting Notes
It took an hour to get through the business portion, mainly due to individual investors bringing up some of the (imho mundane) ideas we've seen floating around the boards. Much of it revolved around compensation, who owns how many shares, and who sold when. I am in complete agreement with Jay Emmett when he said that Al Kahn is a vital resource that other companies would love to attract. He did say that the compensation committee was very worried when MAT was looking for a new CEO. Al spoke passionately about 4Kids and his reasons for staying with us. IMHO, only right that he be compensated for what he's done for the company, and I'm glad the Compensation Committee is not foolish enough to insult him!

The reason they only asked to double the number of shares is because that is considered "routine" and they only need 1/3 to make a quorum. There are almost 30,000 shareholders of KIDE, and they would need to get 2/3 of them to reply for anything requiring a "shareholder directed vote". That nixed the idea of moving incorporation to DE or asking for more than a double of available shares.

KIDE intents to fight shorts by showing them there is no more downside. 4Kids has spend a lot of time talking with money managers. Al said that a buyback makes shorts laugh...all the company does is blow their cash. FWIW, Al bought KIDE shares for his adult kids (20-40K) at $30, thinking the price would turn around. Also, through pure serendipitity, ALL his shares are sitting in a safe-deposit box (not available to shorts)

On to the presentation, update on properties

The upshot of most of this is that KIDE is still negotiating many deals and they will release them as they close them.

Pokemon
#'s out of Germany will be significant. Per kid purchases there are even higher than US. Sold 7M first movie stateside. Nov 21 is release date for P2000 Home Video. Pokemon the 3rd movie due summer 2001, sworn to secrecy on movie title. Poke vitamins have taken over Flintstones. Biggest kid brand in history. "The force is with us". To date, Poke accounts for 14 billion. Poke-Kellog most successful cereal for them, ever. Negotiating with major pop star right now for song for Poke2000 movie that Al thinks can hit the top of the chart by itself.

POKEMON STAGE SHOW WILL START AT RADIO CITY MUSIC HALL AND TRAVEL THE COUNTRY!

WCW
Been getting *&^ whupped, but WCW has been changing stars to up their ratings. (Sorry, still not impressed)

Nintendo
LCI now developing "Classic Nintendo Licensing"

Monster Jam
Expecting revenues to start in 2000, continue with 2001, 2002.

Perfect Dark.
OK, I'm not in the demographics for this (18-34 male) but the trailer they showed us had ME wanting to buy the game and see the movie. The trailer will be released in 4000 theaters. KIDE has been hired by Rare for all their licensing.

Tech4Kids.
Presented first products, expect to make first sale immenently. They can't announce yet because Tech4Kids deals with companies on a non-disclosure basis. Al mentioned that they were talking with Lucent, helping them sell to toy companies.

Websites4Kids
In it to make money. Creating brand and specific subscription-based websites. First announced is GirlsGymnastics.com headed by Bela Karoli. He'll coach. Site will include 3D and slow streaming video for instruction. Will include advice on eating/drinking/training, include advice to parents on selecting coaches. Cost $4/mo to each kid.

Tama&Friends
KIDE has been looking for classics in Japan, their versions of Mickey Mouse, the things they grew up with and the things proven over time. The music and the video were very upbeat. I think the Barney set will go ga-ga over Tama.

Cubix
New, robots. Music for the trailer was kinda rappy, graphics a mix. I can't guess how the kids are going to react cause mine doesn't like CGI in general, but adores anime.

Marvel
Xmen trailer was AWESOME! This is going to be one major movie. The movie is being produced by 20thCFox, KIDE will be licensing in 16 categories, tshirts, etc.

(I took a break, missed most of the short financial presentation, but don't think there was anything new there.)

Misc:
4Kids and partners will be setting up a Pokemon Foundation with Nintendo to give back to kids some of the bounty they've received. Al is on the board of three or four different charities.

They have been meeting with analysts, there is an interest level there, but KIDE can make no guarantees. They are looking for a PE of an entertainment company rather than a toy company. (They don't make toys!) 25-30 would be more appropriate now. They have been giving guidance to analysts that they cannot release to us because of the safe harbor provisions.

Note: Al Kahn said that they are far more interested in the shareholders who plan to be with 4Kids for the next few years rather than the concerns of those who are only looking at a few short months.
Personal Note,
My kid is THRILLED with the Pokemon fruit snacks (new, not the rolls), the Charmander keychain and the Team Rocket Booster Packs I brought home!

Have a great evening,
Profit Searcher


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