Modern Wax Fund

A Unique Investment Opportunity Offered By Attic Investments and Blowout Cards

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Why Private Equity Funds for Trading Cards?

Attic Investments founder David Arons, CFA has spent most of his career either in the institutional investment management or the private equity sector. As a long-time collector/investor in trading cards he sees their potential and that of other collectibles to become a small portion of Institutions’ private equity allocation. In order for this to happen there would need to be a history of investment vehicles up to the standard that Institutions are familiar with. This is believed to be the first time that trading cards are being packaged to this standard as a private equity fund. David believes that Funds and/or other investment vehicles will provide the performance history needed to attract institutional investment. Therefore, this Fund will be managed with the same fiduciary duty expected by institutions. This includes the oversight and reporting that institutions expect.

Blowout Cards, as one of the leading retailers of factory-sealed trading card products has benefited from the growth in the trading card market over the past decade. The Executive Team has also long realized the investment potential of the product and has strategically held product back that they feel holds the most potential for an increase in value. Blowout is offering $3M of some of this product for the Fund, not because they want or need to sell the product, but because they understand the potential benefits to the industry that new money would bring, and in particular, institutional money.

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Management is Fully Committed to Making this Fund a Success

Management is aware that the first fund in an alternative asset class is going to require pioneering investors. In recognition of this, the Manager is taking the following steps to help ensure the Fund’s success, to provide downside protection and ensure that the interests of the Manager and Investors are aligned.

• Maintaining ownership of at least 50% of the Fund.

• Providing a put to investors to create liquidity for investor if needed.

• An Origination Fee well below market at less than 0.8%.

• A small nominal annual Asset Management Fee of $18,000 per year.

• Deferring all fees to be paid to Manager for Management, Storage and Insurance until they can be covered from asset sales in Year 4.

• Will come out of pocket if needed to cover any third-party fees until they can be paid with proceeds from asset sales in Year 4.

• Will cover 50% of any Fund establishment costs above $60,000.

The Manager believes in this asset class and has a long-term view related to investments in trading cards/collectibles packaged as private equity Funds and is taking the above steps for this Fund only, and as the market matures, the above steps will be curtailed.

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History of Trading Card Market

Most people are familiar with trading cards, specifically baseball cards, from what is now called the ‘junk wax era’. This is when baseball cards exploded in popularity in the late 1980s through the mid-1990s. This period was the first time the general public viewed investing in sports cards as a legitimate investment. The era came to a crashing stop primarily due to the reasons discussed below.

Elements of the Junk Wax Era

Supply & Demand

Demand – Dramatic increase in the demand for cards ranged from kids going to their local chain/retail/drugstore and buying up packs of cards at 25¢ a piece right up to Wayne Gretzky and Bruce McNall famously buying the holy grail of cards, the T206 Honus Wagner in 1991 for $451,000.

Supply – The manufacturers of cards reacted to this increase in demand primarily in one way: running the printing presses. This also included a few instances of the additional printing of cards from previous years’ product. Supply shot past demand, causing many of the cards to be worthless or ‘junk’ – and the bottom fell out of the industry.

Market Efficiency

This era ushered in the opening of thousands of baseball card shops around the country as well as a plethora of baseball card shows where dealers would set up to sell their cards. These shops and dealers benefited greatly from the increase in demand and the increase in prices of cards on the secondary market. However, if the average collector/investor wanted to sell a card they would likely have to go back to the same card shops or dealers and be offered only a fraction of what the card was worth.

In retrospect it is easy to see why this was an unsustainable market for a collectible.

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Modern Trading Card Market The current trading card industry attracts more money, has a wider collector/investor base, operates more efficiently and has provided returns greater than those unfamiliar with it realize.

The elements of the current market and the modern product that have fueled the growth:

Manufactured Scarcity – Having learned the lessons from the junk wax era, manufacturers now realize that in order to create a healthy, long, sustaining market the answer is not just increasing supply. Packs of cards no longer cost a quarter and it is not uncommon for the MSRP of a box of cards to be in the thousands. On some of the most limited product, every card in the set may be serial-numbered. And even in the higher-produced product there are always some serial-numbered or parallel cards included, with the odds of finding these cards stated on the product. By utilizing the publicly-available odds, collectors/investors are able to back into the total number of cards produced for each product, eliminating the chance a manufacturer will just continue to run the presses.

Increase in Quality of Cards – Manufacturers have not just used improved paper stock and printing technology but most product in today’s market includes:

• Autographed Cards

• Cards with Game Used Material Embedded

• Serial-Numbered Parallel Cards.

Efficient Marketplace – eBay in its own way played a major role in the re-emergence of the industry. Through eBay the average collector/investor has a way to sell cards on the secondary market at fair market value.

Graded Cards – Third-party grading companies now encapsulate and assign a grade to cards based on condition, similar to the grading of coins that previously existed. While these grades are objective and assigned by a human, they provide a way for a buyer to gain confidence in the authenticity and quality of a card which can be critical when the buyer is unable to inspect the card in person. This has also created a tiered market for a specific card. The higher-graded cards often sell for multiples of what a lower-graded or ungraded version of the same card sells for.

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Modern Trading Card Market – Autographed / Game Used Cards

Below are some of the more recent elements of the trading card market, certified autographs and Game Used material.

To the right are examples of a Game Used jersey from Panini Flawless and a Game Used bat card from Topps Heritage.

To the left is an example of an autographed card from Bowman Chrome Draft Picks.

To the right is an example of a rookie patch autograph (RPA) from Panini National Treasures and to the left is an example of a booklet patch autograph, also from National Treasures.

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Modern Trading Card Market – Serial-Numbered / Parallel Cards The examples of variations/parallels below can all possibly be pulled from the unopened product in the Fund. Some are numbered to as low as 1/1. As unopened supply decreases, the chase for these variations/parallels is a key reason for the sustainability of a product price and price growth. The parallels also help to maintain and grow the value of unopened product because player-collectors still desire them, even when they are not rookie cards. Some of the Variations Available of the Mike Trout RC from 2011 Topps Update:

Base Cognac Diamond Diamond Gold #’d /2011 Black #’d /60 Blue Hope Canary Diamond Anniversary Anniversary Diamond #’d /60 #’d /1

Some of the Image Variations Available of the Ronald Acuna RC from 2018 Topps Update:

These variations are considered to be Short Printed (SP) or Super Short Printed (SSP) and none of them are numbered.

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Modern Trading Card Market – Graded Cards Below is an example of how the grade a card is assigned can greatly impact value. Many covet unopened product because of the likelihood that the condition of cards will be high since the only defects would be manufacturing rather than handling of the card on the secondary market.

1986 Fleer Michael Jordan Price*

Grade: PSA 10 $32,947

Grade: PSA 9 $5,815

Grade: PSA 8 $2,684

Grade: PSA 7 $1,896

Grade: PSA 6 $1,438

Grade: PSA 5 $1,419

*Prices per VintageCardPrices.com on 1/2/20

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Growth in Industry

The overall growth in the industry is hard to quantify due to a lack of public information. There is only one public company in the industry which is the parent of Professional Sports Authenticator (PSA). The largest manufacturer, Topps, was acquired in 2007 by a group led by Michael Eisner after he retired as CEO of Disney.

Data provided by Collectors Universe (NASDAQ: CLCT) reported the following information regarding its trading card unit, PSA:

Trading Cards Increase in Trading Card Revenue Trading Card Revenue CLCT Fiscal Year Graded Cards Graded Generated Increase

Q1 2020 vx. Q1 2019 735,000/NA $8M/$6M 33.3%

2019 1,763,700 20.1% $26.4M 25.1%

2018 1,457,900 14.0% $21.1M 17.9%

2017 1,278,900 7.2% $17.9M 12.6%

2016 1,269,800 $15.9M

In the Q1 2020 Earnings Release, PSA stated that they “ended the quarter with an unprecedented submission backlog, the largest in the division’s history.”

Also of note is that the August 2019 National Sports Collectors Convention was attended by 90,000 people, the highest in 28 years.

International – Cards now have an international presence as well. Asia’s demand for Basketball is strong and makes up a meaningful percentage of the market, in particular the more expensive cards. Manufacturers and retailers such as Blowout have their own distribution network and channels.

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Trading Cards as an Investment There are currently a few sources that organize and display the performance of trading cards as an investment.

PWCC100 – PWCC is one of the largest online eBay auction consigners. They have created an index that represent the top 100 cards of a specific grade by PSA per an algorithm and compare historical prices to the S&P 500. (www.pwccmarketplace.com)

Collectors Equity – Creates indexes that measure the market cap of cards, using the PSA-graded population x price. They have various indexes by sport and overall. The chart to the right is the GCI250, the top 250 cards overall. (www.collectorsequity.com)

VintageCardPrices.com – Provides historical prices for graded cards. The image to the left shows the performance of Derek Jeter’s key first card since his retirement in 2014. (www.vintagecardprices.com)

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Why Unopened Product Rather Than Individual Cards?

Supply, Supply and Supply. Investing in individual cards of key players or subjects is a valid investment strategy. However, the most compelling reason for investing in unopened boxes and cases comes down to supply. While the overall supply of a card in a particular product is fixed, the supply of unopened boxes and cases can only decrease. As an extreme example, there are estimated to be at least 150,000 individual 1986-87 Fleer Basketball Michael Jordan cards manufactured, which would have required the production of at least 50,000 boxes of 1986-87 Fleer Basketball. One would think that with at least 50,000 boxes manufactured, it should be relatively easy to find one. Over the last 90 days of 2019 there were over 500 1986-87 Fleer Michael Jordan cards sold while there have only been 7 boxes of 1986-87 Fleer Basketball auctioned on eBay since 2010. Additionally, two legitimate recorded openings of a box are available to view on YouTube from the last year, further decreasing supply.

Group Breakers are Accelerating the Decrease in Supply – Nothing has contributed more to the acceleration of unopened product than group breakers. The economics are such that a product is purchased and then sold off to participants in the break in smaller units that in total results in a profit to the breaker. The product will range from a pack of older/vintage high-value product where a participant is buying the rights to one card in the pack, to the product being multiple cases of modern cards where the participant buys the rights to a certain player or team. The appeal to the participant of a break may vary. However, the ability to have a vested interest in the opening of a product that is rare or so expensive that they would not be able or willing to purchase and open it themselves is what has accelerated the reduction of supply of higher-end product that the Fund will have significant holdings in.

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Opportunity

Attic Investments and Blowout Cards, one of the leading, most-respected online retailers of unopened trading card products, is offering a one-of-a-kind opportunity to invest in some of the rarest, most valuable and desired factory-sealed or professionally- authenticated unopened products in the modern trading card era.

The Fund will contain $3M of Blowout’s most prized inventory of unopened boxes and cases that include the following products:

• 1986/87 Fleer Basketball – Possible Michael Jordan RC*

• 1993 Upper Deck SP Baseball – Possible Derek Jeter RC*

• 2009 Bowman Draft Baseball – Possible Mike Trout 1st Autograph*

• 2011 Topps Update Baseball – Possible Mike Trout RC*

• 1996/97 Topps Chrome Basketball – Possible Kobe Bryant RC*

• 2003 Topps Chrome Basketball – Possible Lebron James RC*

• 2000 Upper Deck SP Authentic Football – Possible Tom Brady RC*

• 2017 Panini National Treasures Football – Possible Patrick Mahomes RC*

• 2018 Panini National Treasures Basketball – Possible Luka Doncic RC*

*These would be products that may contain the cards listed but are not guaranteed.

Wax – Until the 1990s, manufacturers typically used wax paper as the wrapper for card packs. Despite the replacement of wax paper with more tamper-proof packaging, the industry still commonly refers to unopened product as ‘wax’.

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Opportunity / Offering Detail The market for sports cards has seen dramatic growth over the last 10 years and investors have started to take notice.

❑ Opportunity: One of the best ways to invest in this market is to allocate funds to unopened/factory-sealed product for some of the following reasons:

▪ Exposure to all of the underlying players in that product, rather than picking and choosing which players to invest in.

▪ Unopened product is an asset that is truly finite, meaning supply will only decrease.

▪ The rise of case/box breakers has accelerated the pace of existing product being consumed.

▪ No reliance on third-party grading companies, and the risks of altered cards.

❑ Offering Details:

▪ Fund Size: $3.15M

▪ Fund Assets: The assets will consist of unopened boxes and cases of sports or entertainment trading cards ranging from 1986 to 2019.

▪ Source of Assets: The Fund will acquire the identified assets from Blowout Cards via an existing Purchase Option. The assets are under contract at fair market value with full transparency on product and pricing disclosed in the Fund-offering documents.

▪ Manager: Modern Wax Fund Manager, LLC consists of David Arons, CFA (Chartered Financial Analyst) of Attic Investments, LLC and the Executive Team of Blowout Cards, consisting of Thomas Fish, Chris and Dan Park.

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Opportunity / Offering Detail

❑ Offering Details Continued:

▪ Seller Retaining Ownership: Blowout Cards will be retaining 50% ownership via ownership of 63 Units.

▪ Units Offered: 63 Units are being offered at $25,000 per Unit.

▪ Offering Period: Through February 2020.

▪ Term: Target Fund End Date of Year 7.

▪ Entity Type: Delaware Limited Liability Company.

▪ Fund Open To: Accredited Investors Only.

▪ Return Target: 12% – 18% Annually.

▪ Assets will continue to be stored and insured via Blowout Card’s facility and insurance policy.

❑ Asset Sales:

▪ Asset Sales will occur in years 4–7 with a 25% target per year.

▪ Any proceeds from sales will be distributed quarterly.

▪ Manager (The Blowout Executive Team) will be making the specific asset sale recommendations to maximize returns to investors.

▪ Blowout Cards’ provenance of the assets will be beneficial in the marketing and sale of the assets.

▪ All assets will be sold in an open and transparent format. Sales may be directed to the following, but not limited to; eBay, Heritage Auctions, Goldin Auctions, Lelands, top online consigners or emerging fractional ownership platforms. None of the sales will be through Blowout Cards’ retail platform.

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Opportunity / Offering Detail

❑ Put Rights: Manager will be providing a Put Option to each investor to provide liquidity to investors should they need it before asset sales and distributions begin in Year 4.

▪ Put Exercise Rights: Only exercisable by the investor at the discretion of the investor.

▪ Put Exercise Window: Starting in Month 7 through Month 42. Month 42 is 6 months before asset sales are set to begin.

▪ Put Exercise Price: $20,000 per unit or 80% of the initial investment price per unit.

Blowout Cards booth at the 2019 National Convention in Chicago.

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Assets

The assets could be considered to fit into two tiers, with many assets meeting the standard for both tiers. FIRST TIER SECOND TIER

Product that may contain some of the More recently-issued product that may most sought-after cards in the industry. contain key cards of younger active players These would be product that contain such as Pat Mahomes, Ronald Acuna Jr., rookie cards, autographed cards or key Juan Soto, Kawhi Leonard, Zion parallels of players such as Michael Williamson, Lamar Jackson, Luka Doncic, Jordan, Tom Brady, Peyton Manning, Conner McDavid, Trae Young, Jimmy Derek Jeter, Mike Trout, Sydney Crosby, Garappolo and Giannis Antetokounmpo Kobe Bryant and Lebron James. These are among others. Not all of the players in players that are either retired or close to these products will continue down the Hall retirement and the desirability of their of Fame / Superstardom path, but some of cards is cemented in the industry. them will, and there will also be the emergence of players not currently considered superstars.

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Topps Update Baseball Hobby Current Price Per Price Per Box at Release* Increase Box History Box** 2011 Topps update $52 $6,500 12,400% 2012 Topps Update $50 $200 300% 2013 Topps update $45 $290 544% The table provides a 2014 Topps Update $45 $200 344% 2015 Topps update $50 $160 220% snapshot of how one of 2016 Topps Update $40 $60 50% the key baseball products 2017 Topps update $50 $120 140% 2018 Topps Update $45 $300 567% has performed since release. The Fund will hold Topps Update Baseball Hobby Box Rookie Card History assets for each of the 2011 Topps update Mike Trout, Jose Altuve, Paul Goldschmidt, J.D. Martinez years above with the 2012 Topps Update Bryce Harper exception of 2012. Topps 2013 Topps update Christian Yelich, Nolan Arenado, Gerrit Cole, Anthony Rendon 2014 Topps Update Mookie Betts, George Springer, Jacob DeGrom Update was chosen in this 2015 Topps update Francisco Lindor example because it is a 2016 Topps Update product that is produced 2017 Topps update Cody Bellinger 2018 Topps Update Ronald Acuna Jr., Juan Soto, Gleyber Torres every year.

*Price per box at release is based on eBay auction history at time of release. ** Current price per box is based on offering price from online retailers and on eBay as of 12/20/19.

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Example of Basketball Product Performance

Panini Prizm Basketball Hobby Current Price Per Price Per Box at Release* Increase Box Box** 2012/13 Panini Prizm $90 $1,800 1,900% 2013/14 Panini Prizm $90 $1,600 1,678% 2014/15 Panini Prizm $65 $400 515% The Fund will hold 2015/16 Panini Prizm $55 $460 736% assets for each of the 2016/17 Panini Prizm $160 $800 400% 2017/18 Panini Prizm $260 $375 44% years represented in 2018/19 Panini Prizm $215 $680 216% these tables. Panini Prizm was chosen in Panini Prizm Basketball Hobby Box Rookie Card History this example because 2012/13 Panini Prizm Kahwi Leonard, Anthony Davis, Kyrie Irving, Damian Lillard it is a product that is 2013/14 Panini Prizm Giannis Antetokounmpo 2014/15 Panini Prizm Joel Embiid, Zach Levine, Andrew Wiggins produced every year. 2015/16 Panini Prizm Devin Booker, Nikola Jokic, Kistaps Porzingis, Karl-Anthony Towns Ben Simmons, Brandom Ingram, Pascal Siakam, Jamal Murray, Jaylen 2016/17 Panini Prizm Brown 2017/18 Panini Prizm Jaysom Tatum, Donovan Mitchell, De’Aaron Fox, Kyle Kuzma 2018/19 Panini Prizm Luka Donic, Trae Young

*Price per box at release is based on eBay auction history at time of release. ** Current price per box is based on offering price from online retailers and on eBay as of 12/20/19.

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Example of Football Product Performance

Current Price Per Panini Prizm Football Hobby Box Price Per Box at Release* Increase Box** 2012 Panini Prizm $120 $180 50% 2013 Panini Prizm $75 $75 0% 2014 Panini Prizm $65 $115 77% 2015 Panini Prizm $65 $95 46% Product from each of 2016 Panini Prizm $105 $500 376% the years in the table 2017 Panini Prizm $105 $925 781% 2018 Panini Prizm $155 $355 129% will be held by the Fund. Panini Prizm Panini Prizm Football Hobby Box Rookie Card History was chosen in this

2012 Panini Prizm Andrew Luck, Russel Wilson example because it is 2013 Panini Prizm LeVeon Bell a product that is 2014 Panini Prizm Jimmy Garappolo, Derek Carr, Odell Beckham Jr., Khalil Mack produced every year.

2015 Panini Prizm Marcus Mariota, Jameis Winston, Todd Gurley, Amari Cooper

2016 Panini Prizm Carson Wentz, Jared Goff, Ezekies Elliot, Dak Prescott

2017 Panini Prizm Pat Mahomes, Deshaun Watson, Mitchell Trubisky, Christian McCaffrey Baker Mayfield, Sam Darnold, Saquon Barkley, Josh Allen, Lamar Jackson, Josh 2018 Panini Prizm Rosen

*Price per box at release is based on eBay auction history at time of release. **Current price per box is based on offering price from online retailers and on eBay as of 12/20/19.

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Value-Added Sale Options

The Manager will try to sell assets at the top or above the estimated value range by strategically utilizing some of the existing and evolving platforms which include:

• Live Auction Houses – The top tier live auction houses for trading cards may be utilized such as Heritage, Goldin, Lelands etc.. These auction houses have strong marketing infrastructure with catalogues, print, online and email. They are also utilized by deep-pocket buyers that are not comfortable with online auctions or prefer the anonymity and personalized service of these companies.

The Fund may choose to auction a number of items at the same time with an auction house that will brand and market the auction in a way that will lead to greater exposure such as the David Hall T206 Collection.

• Top Online Consigners – The top online consigners often realize higher prices than comparable auctions due to a large number of followers. They also have well-run email marketing programs that highlight the higher end and rarer items. The Fund would work to make sure items are highlighted in these marketing campaigns.

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Value-Added Sale Options

• Crowdfunding / Fractional Ownership Platforms – The platforms for selling fractional shares of an asset as an investment vehicle are starting to gain mainstream appeal. In October 2019 Rally Rd. offered a thousand shares of a 1952 Topps Mickey Mantle graded SGC 7 at $132 a share and it sold out in 4 minutes. The total offering price of the card, $132,000, is approximately 30% over what the card would have sold for at an open auction. The Manager feels a number of the high value assets in the Fund could benefit from this type of sale.

The card that was sold via Rally Rd.’s fractional ownership platform for $132,000 in October 2019 was purchased in May 2018 for $84,000.

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Value-Added Sale Option

• Breaking Product into Smaller Units – The Manager will evaluate the option of breaking down a product into smaller units to sell individually for a gain above current full unit value. Boxes may be sent to PSA to have the individual packs graded and encapsulated to be sold as individual packs rather than a full box.

Example: The Fund will be purchasing 4 boxes of 2003-04 Topps Chrome Basketball Hobby boxes for $3,600. Each box has 24 packs, so the average acquisition cost per pack is $150. The two most recent eBay sales of graded packs were for $260 and $199 per vintagecardprices.com. At $200 per pack the fund could net an extra $700+ per box after grading fees.

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The Manager

The Manager is a Joint Venture between Attic Investments, LLC and Blowout Cards.

• Attic Investments is founded by a Chartered Financial Analyst (CFA) with a career in Private Equity

(primarily Real Estate) who is also a long-time hobby participant/investor. Attic Investments believes

that the trading card market has become mature enough to warrant more sophisticated investment

vehicles such as funds. This is similar to what occurred with wine about a decade ago.

• Blowout Cards was founded in 1999 and through its online presence (www.blowoutcards.com), has

become a leading online retailer for sports and other trading cards, boasting one of the most

extensive inventory of boxes in stock and running an industry-leading forum

(www.blowoutforums.com).

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Additional Information

▪ How to find out more: Please go to www.atticinvestments.com to access the full Private Placement Memorandum (PPM).

▪ To Learn more about Blowout Cards: Please go to https://www.blowoutcards.com/about-us/ or email [email protected]

▪ Questions & Suggestions Encouraged: This is the first fund of its kind, and any productive dialogue to address concerns, suggestions, clarifications, ideas or interest in future funds or investment vehicles is encouraged.

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