Exhibit TN-2: Margin Chain for Manufacturere Selling Price (Natureview Yogurt)

Supermarket Channel 8oz 32 oz

Retail Price $0.74 $2.70

Retail Margin 27.0% 27.0%
Retail Purchase Price (RPP) $0.54 $1.97
Distributor Margin 15.0% 15.0%
Distributor Purchase Price (DPP) $0.46 $1.68
Manufacturer Sales Price (MSP) 0.459 1.675
Cost Per Unit 0.31 0.99
Contribution per Unit Sold 0.149 0.685
Manufacturer Gross Margin 32.49% 40.91%

Natural Foods Channel 8oz 32oz

Retail Price $0.88 $3.19

Retail Margin 35.0% 35.0%
Retail Purchase Price (RPP) $0.57 $2.07
Natural Foods Distributor Margin 9.0% 9.0%
Natural Foods Distributor Purchase Price $0.52 $1.89
Wholesaler Margin 7.0% 7.0%
Wholesaler Purchase Price (WPP) $0.48 $1.75
Manufacturer Sales Price (MSP) 0.484 1.755
Cost Per Unit 0.31 0.99
Contribution per Unit Sold 0.174 0.765
Manufacturer Gross Margin 35.96% 43.58%

Exhibit TN-4 Evaluation of Growth Options

Input Data Source

Option 1 (8 oz.) 6 SKU to Supermarket
20 Supermarket Chains
2 Regions
Ad Plan $1,200,000 per region per annum text
Sales 35,000,000 units per annum text
Slotting fees $10,000 per Chain per SKU text
Gross Profit $5,220,950 formula = units sold * $ cont
Less Ad Costs ($2,400,000) 2 Regions
Less Incremental SGA ($320,000) $200K sales + $120K mkt text
Less Slotting Fees ($1,200,000) 20 Chains, 6 SKU per Chain
Trade Promotion Expense ($870,000) 11 Supermarkets in NE, 9 in West, 4 times p.a.
Less Broker's Commissions ($642,838) 4% of sales formula = MSP * units sold
Profit Contribution ($211,888)

Sales Growth $16,070,950 Market Share sales growth = MSP * units

1.5% of supermarket yogurt sales (last year)
2.0% of supermarket yogurt 6-8 oz sales (las

Option 2 (32 oz.) 4 SKU to Supermarket

 64 Supermarket Chains
4 Regions
Ad Plan $120,000 per region per annum text
Sales 5,500,000 units per annum text
Slotting fees $10,000 per Chain per SKU text
Gross Profit $3,769,425 formula = units sold * $ cont
Less Ad Costs ($480,000) 4 Regions
Less Incremental SGA ($160,000) Half of Option One text
Less Slotting Fees ($2,560,000) 64 Chains 4 SKU
Trade Promotion Expense ($1,024,000) 64 Chains 2x per annum text
Less Broker's Commissions ($368,577) 4% of sales formula = MSP * units sold
Profit Contribution ($823,152)

Sales Growth $9,214,425 Market Share sales growth = MSP * units

10.3% of 32oz yogurt sales nationally (last ye

Option 3 (Multipack) 2 SKU of Multipack to Natural Foods Channel

Ad Plan $250,000 text
Sales 1,800,000 units per annum text
Free Cases (slotting) fee 2.5% of Manufacturer Sales (net of broker fees)
Gross Profit $1,247,073
Less Ad Costs ($250,000)
Less Free Cases ($82,927) formula = 1.8m units sold * M
Less Broker's Commissions ($132,683) 4% of sales formula = MSP * units sold
Profit Contribution $781,463

Sales Growth Year 1 $3,317,073 Market Share sales growth = MSP * units
11.2% of natural foods channel (last year)

Exhibit TN-3 Market Share Analysis of Yogurt Market

Market Dollar Size % Total Annual

Growth Rate
Total Refrigerated Yogurt Market $ 1,800,000,000 100% 3.5%
Supermarket Channel 1,746,000,000 97% 3.0%
Natural Foods Channel $ 54,000,000 3% 20.0%

Total Refrigerated Yogurt Market $ 1,800,000,000 100% 3.5%

6 oz. & 8 oz. 1,332,000,000 74% 3.0%
32 oz. 144,000,000 8% 2.0%
Children's Multipack 162,000,000 9% 12.5%
All Other $ 162,000,000 9% 0.1%

Total Refrigerated Yogurt Market $ 1,800,000,000 100%

Northeast 468,000,000 26%
Midwest 396,000,000 22%
Southeast 450,000,000 25%
West $ 486,000,000 27%
 Note: $ Figures rounded to 2 decimal places and % to one,
except as noted below
Input Data Source

Exhibit 3
Text - Supermarkets

Text - Supermarkets

(Rounded to 3 decimal places)

Exhibit 3
(Rounded to 3 decimal places)
(Rounded to 2 decimal places)

Multipack

$3.35 Exhibit 3
35.0% Text - Nat Foods
$2.18
9.0% Text - Nat Foods
$1.98
7.0% Text - Nat Foods
$1.84
1.843 (Rounded to 3 decimal places)
1.15 Exhibit 3
0.693 (Rounded to 3 decimal places)
37.60% (Rounded to 2 decimal places)

put Data Source

Option 1
Option 1
Supermar
rmula = units sold * $ contribution per unit (Note rounding in Table TN-2)

Option 1

rmula = MSP * units sold * 4% (Note rounding in Table TN-2)

ales growth = MSP * units sold

ket yogurt sales (last year)
ket yogurt 6-8 oz sales (last yea
 Option 2
Option 2
Supermarket
rmula = units sold * $ contribution per unit

Option 2

Option 2, Supermarkets
rmula = MSP * units sold * 4%

ales growth = MSP * units sold

urt sales nationally (last year)

Option 3
Option 3

rmula = 1.8m units sold * MSP * 2.5%

rmula = MSP * units sold * 4%

ales growth = MSP * units sold

ods channel (last year)

Input Data Source

Text - Yogurt Category

Text - Yogurt Category
Text - Yogurt Categ

Text - Yogurt Category

Ex 2A
Ex 2A
Ex 2A
Ex 2A

Text - Yogurt Category

Ex 2B
Ex 2B
Ex 2B
Ex 2B
 1 2 3 4 5
Sales (Mn Units) 5.50 6.60 7.92 9.50 11.40
Inc. Sales ($) 9,240 11,088 13,306 15,967 19,160
Less - Mfg Cost 5445 6534 7841 9409 11291
Inc. Gross margin 3,795 4,554 5,465 6,558 7,869
Less - Broker fee 370 444 532 639 766
Less - Slotting fee 2560 0 0 0 0
Trade Promotions
Mrktg Support 480 480 480 480 480
Inc. CG & A 160 160 160 160 160
Inc. Profit 225 3,470 4,293 5,279 6,463
Ref
5500 growing at 20% rate
Units * 1.68$
Units * 0.99$

Sale * 4%
64chains * 4SKU
Price * No of retailers per region * 2times p.a.
120000 per region pa.
Fixed Annual cost
 1 2 3 4 5
Sales (Mn Units) 1.80 2.07 2.38 2.74 3.15
Inc. Sales ($) 3,312 3,809 4,380 5,037 5,793
Less - Mfg Cost 2,070 2,381 2,738 3,148 3,620
Inc. Gross margin 1,242 1,428 1,643 1,889 2,172
Less - Broker fee 132 152 175 201 232
Less - Slotting fee 83 - - - -
Trade Promotions - - - - -
Mrktg Support 250 300 300 300 300
Inc. CG & A - - - - -
Inc. Profit 777 976 1,167 1,387 1,641

Sales (Mn Units)

Inc. Sales ($)
Less - Mfg Cost
Inc. Gross margin
Less - Broker fee
Less - Slotting fee
Trade Promotions
Mrktg Support
Inc. CG & A
Inc. Profit
Option 3 (Multipack) 1999 2000 2001 2002 2003
Ad Plan $250,000
Sales 13,000,000 1,800,000
Free Cases (slotting) fee
Gross Profit $1,247,073
Less Ad Costs ($250,000)
Less Free Cases ($82,927)
Less Broker's Commissions ($132,683)
Profit Contribution $781,463

Sales Growth Year 1 $3,317,073

 Ref
1.8mn products at 15% p.a.
Units * 1.84$ p.u.
Units * 1.15$ p.u.

Sale * 4%
64chains * 4SKU
Price * No. of retailers per region * 2times p.a.

Fixed Annual Cost

2004 2005