All statements contained herein that are not historical facts, including but not limited to, statements regarding future operations, financial condition and liquidity, future borrowing, capital requirements, and our future development and growth plans, are based on current expectations. These statements are forward-looking in nature and involve a number of risks and uncertainties. Actual results and the timing of events may differ materially from those anticipated in these forward-looking statements as a result of a number of factors, including those set forth under the headings "Risks Factors" in our Form 10-KSB for the year ended December 31, 2007 and other risk factors described herein and our reports filed and to be filed from time to time with the Commission and the cautionary note regarding "Forward-Looking Statements." The discussion and analysis below is based on the Company's unaudited consolidated financial statements for the three months and nine months ended September 30, 2008 and 2007. The following should be read in conjunction with the Management's Discussion and Analysis of results of operations and financial condition included in Form 10-KSB for the year ended December 31, 2007.

Overview

We are a consumer products company focused on selling high quality household, personal care, and other products at affordable prices. In addition to our consumer products business, we operate a smaller, non-integrated business which entails the ownership and leasing of certain real estate holdings in Granby, Connecticut.

Our model for successfully bringing the products that we develop or license to market typically begins with what we refer to as a "transactional marketing" campaign, which is designed to build product and brand awareness while at the same time generating sales. Our transactional marketing campaigns are conducted in as many channels of consumer media as are viable for generating immediate sales in response to our product advertisements, including television, print, radio and the internet.

Our ultimate goal is to leverage product and brand awareness generated from transactional marketing into wholesale sales of our products to resellers, which include national retail and drugstore chains as well as home shopping channels, catalog publishers and international distributors. In addition, based on results achieved and relationships established through this channel, we have begun developing, licensing and selling products that are intended for retail distribution only, a trend we expect to continue through 2008. We currently have products placed with many of the nation's largest retail outlets, including WalMart, Target, Sears and Bed Bath and Beyond, as well the nation's major drug chains such as CVS, Walgreens and RiteAid.

Our financial results are presented in two segments: consumer products and real estate. Beginning with our acquisition of Worldwide Excellence ("WWE") in November 2005 (at which time our historical results of operation became those of WWE), and continuing through July 2006, we reported results in a direct response (or transactional) marketing segment and a real estate segment. With our acquisition of the assets of the consumer products business of Adsouth Partners, Inc. in August 2006, including the retail distribution relationships and network we acquired, we began reporting a third segment named "retail distribution."

Due to changes in the way we viewed and used transactional marketing in the latter part of 2007 and going forward, we made the decision to present transactional marketing and retail distribution as a comprehensive consumer products segment. This change arose from developments in our business and the marketplace in which we operate. We believe that our transactional marketing efforts support sales in our other channels of distribution, operating synergistically as opposed to independently. Furthermore, increasing costs of television media have made it more and more difficult to conduct profitable transactional marketing campaigns, causing us to concentrate on further developing wholesale channels of distribution where we experience lower gross margins but higher net margins. For this and other reasons, our wholesale sales, in particular to our retail store accounts, have become an increasing percentage of overall sales, which we expect will continue through 2008. Direct sales to consumers through transactional marketing remains a source of revenue and an important part of our business strategy, but one that we increasingly view more as a method of advertising our consumer products to build brand awareness in support of our retail distribution channel.

In 2007, we experienced significant revenue growth, driven largely by the roll-out of new products and increased distribution to retailers. Our strategy for continued sales growth in 2008 includes the introduction of 4-6 new products in categories suitable for distribution to most of our existing retail customers as well to new major retail outlets such as office supply stores and electronic stores. In addition, our focus in the latter part of 2007, continuing in 2008, is on products with retail price points between $9.99 and $29.99, which we believe to be better positioned than higher price point products in the current economic environment. Finally, as we continue to pursue new channels of distribution, we expect continued growth in international and home shopping sales.

Critical Accounting Policies

Management's discussion and analysis of its financial position and results of operations are based upon our Consolidated Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and judgments that affect the

reported amounts of assets, liabilities, revenues and expenses, and the related disclosure of contingent assets and liabilities. Actual results could differ from those estimates. Our critical accounting policies are detailed in our Annual Report on Form 10-KSB for the year ended December 31, 2007.

Effects of New Accounting Pronouncements

We describe recent accounting pronouncements in Item 1 - "Condensed Consolidated Financial Statements - Notes to Condensed Consolidated Financial Statements."

RESULTS OF OPERATIONS

Three Months Ended September 30, 2008 Compared to Three Months Ended September 30, 2007.

Revenues and Gross Profit

Consumer Products

The following table summarizes our changes in net revenues and gross profit from
the sale of consumer products (in thousands) for the periods indicated:

                                               Three months ended
                                                  September, 30
                                    Q3          Q3               Change
                                   2008        2007          $            %
                 Net revenue      $ 9,544     $ 8,888     $    656         7 %
                 Cost of sales      5,863       3,012        2,851        95 %
                 Gross profit     $ 3,681     $ 5,876     $ (2,195 )     (37 )%
                 Gross profit %        39 %        66 %

Net Revenues

Net revenues from consumer product sales for the three months ended September 30, 2008 ("Q3 2008") was approximately $9.5 million, an increase of $0.6 million, or 7%, compared to net revenue for the three months ended September 30, 2007 ("Q3 2007") of approximately $8.9 million. The increase in revenues during Q3 2008 was supported by the 2008 product launches of MyPlace and SteamBuddy, which contributed $7.5 million in revenues offset by: (i) a $5.6 million decrease in sales of Hercules Hook and ZorbEEZ, due to the maturity of these products and a reduction in their marketing campaigns, and (ii) a $1.1 million decrease in sales of StarMaker, a beauty product. The reduction in StarMaker sales is a result of our decision to focus more of our marketing efforts on housewares products as compared to beauty products.

Gross Profit

Gross profit decreased $2.2 million, or 37%, to $3.7 million for Q3 2008, from $5.9 million for the comparable prior year period, primarily as a result of the planned change in channel mix revenues as discussed above. The gross profit margin decreased to 39%, from 66% over the comparable prior year period. This change was consistent with our plan to transition to a greater proportion of retail sales which inherently carry lower gross margins than our direct to consumer sales but have significantly lower selling expenses associated with each sale, and resulting in higher net margins. As we increase sales in future periods, we believe this strategy will allow us to better leverage our fixed operating expenses and thereby improve our operating margin.

Real Estate

Revenue was approximately $0.3 million in Q3 2008, an increase of $0.1 million, compared to net revenue of approximately $0.2 million in Q3 2007. There has been no change in the occupancy of the office building we own and operate in East Granby, Connecticut.

Operating Expenses

The following table summarizes our changes in operating expenses (in thousands)
for the periods indicated:

                                                        Three months ended
                                                           September, 30
                                             Q3         Q3                Change
                                           2008        2007          $            %
       Selling                            $ 1,806     $ 3,970     $ (2,164 )     (55 )  %

       General and administrative:
       Consumer products                      828         895          (67 )      (7 )%
       Real estate                            104         103            1         1 %
       Corporate expenses                     682         544          138        25 %
       Total general and administrative     1,614       1,542           72         5 %

Selling Expenses

Consumer Products

For Q3 2008, selling expenses decreased by $2.2 million, or 55%, to $1.8 million, from $4.0 million for the comparable prior year period. As a percentage of revenues, selling expenses for Q3 2008 decreased to 19%, from 45% for the comparable prior year period. As discussed above, this is consistent with management's strategy to transition to a higher proportion of retail sales which require less selling expenses when compared to direct to consumer sales. As a result, our media expenses decreased $1.5 million in Q3 2008 and our selling expenses associated with certain mature products also declined. We monitor our media spending in relation to consumer acceptance of the product and their related willingness to purchase the product through our retail distribution channel.

General and Administrative Expenses

General and administrative (G&A) expenses consist primarily of compensation paid to administrative personnel, professional service fees and public company costs. For Q3 2008, G&A expenses increased by $0.1 million, or 5%, to $1.6 million, from $1.5 million for the comparable prior year period. As a percentage of revenues, G&A expenses for Q3 2008 decreased to 16%, from 17% for the comparable prior year period. As a percentage of sales, we expect G&A to decrease as we continued to leverage our administrative infrastructure and realize the benefits of restructuring activities undertaken throughout 2008 and which are expected to continue in our fourth quarter of 2008.

Interest Expense

Interest expense in Q3 2008 and Q3 2007 was approximately $0.3 million in both periods.

Provision for Income Taxes

We have recorded a 100% valuation allowance against our current year tax loss and prior years net operating loss carry forwards based on the criteria contained in FAS 109 of the realized value of these deferred tax assets.
Notwithstanding management's view of future profitability, in determining whether or not a valuation allowance is necessary, forecasts of future taxable income are generally not considered sufficient evidence to outweigh a history of losses.

Nine Months Ended September 30, 2008 Compared to Nine Months Ended September 30, 2007.

Revenues and Gross Profit

Consumer Products

The following table summarizes our changes in net revenues and gross profit from
the sale of consumer products (in thousands) for the periods indicated:

                                                Nine months ended
                                                  September, 30
                                   YTD          YTD               Change
                                   2008         2007          $            %
                Net revenue      $ 27,069     $ 29,990     $ (2,921 )     (10 )%
                Cost of sales      14,303        9,695        4,608        48 %
                Gross profit     $ 12,766     $ 20,295     $ (7,529 )     (37 )%
                Gross profit %         47 %         68 %

Net revenues from consumer product sales for the nine months ended September 30, 2008 ("2008") was approximately $27.1 million, a decrease of $2.9 million, or 10%, compared to net revenue for the nine months ended September 30, 2007 ("2007") of approximately $30.0 million. The decrease in revenues in 2008 was attributable to: (i) a $16.4 million decrease in sales of Hercules Hook and ZorbEEZ, due to the maturity of these products and a reduction in their marketing campaigns, and (ii) a $2.7 decrease in our beauty product sales, due to our decision to concentrate more of our marketing efforts on housewares products as compared to beauty products.

Gross Profit

Gross profit decreased $7.5 million, or 37%, to $12.8 million in 2008 from $20.3 million for the comparable prior year period, primarily as a result of the planned change in channel mix revenues as discussed above. The gross profit margin decreased to 47%, from 68% over the comparable prior year period. This change was consistent with our plan to transition to a greater proportion of retail sales which inherently carry lower gross margins than our direct to consumer sales but have significantly lower selling expenses associated with each sale, and resulting in higher net margins. As we increase sales in future periods, we believe this strategy will allow us to better leverage our fixed operating expenses and thereby improve our operating margin.

Real Estate

Revenue was approximately $0.6 million in 2008, an increase of $0.1 million, compared to net revenue of approximately $0.5 million in 2007. There has been no change in the occupancy of the office building we own and operate in East Granby, Connecticut.

Operating Expenses

The following table summarizes our changes in operating expenses (in thousands)
for the periods indicated:

                                                        Nine months ended
                                                          September, 30
                                           YTD         YTD                Change
                                          2008         2007          $            %
      Selling                            $ 8,430     $ 13,608     $ (5,178 )     (38 )  %

      General and administrative:
      Consumer products                    2,532        2,764         (232 )      (8 )  %
      Real estate                            325          312           13         4 %
      Corporate expenses                   2,466        1,781          685        38 %
      Total general and administrative     5,323        4,857          466        10 %

Selling Expenses

Consumer Products

For 2008, selling expenses decreased by $5.2 million, or 38%, to $1.8 million, from $13.6 million for the comparable prior year period. As a percentage of revenues, selling expenses in 2008 decreased to 31%, from 45% for the comparable prior year period. As discussed above, this is consistent with management's strategy to transition to a higher proportion of retail sales which require less selling expenses when compared to direct to consumer sales. As a result, our media expenses decreased $4.3 million in 2008 and our selling expenses associated with certain mature products also declined. We monitor our media spending in

relation to consumer acceptance of the product and their related willingness to purchase the product through our retail distribution channel.

General and Administrative Expenses

General and administrative (G&A) expenses consist primarily of compensation paid to administrative personnel, professional service fees and public company costs. In 2008, G&A expenses increased by $0.4 million, or 10%, to $5.3 million, from $4.9 million for the comparable prior year period. The increase was primarily due to $0.2 million of severance expenses and accelerated vesting of stock options in connection with the separation agreement with us and our former President who resigned on March 15, 2008. As a percentage of revenues, G&A expenses in 2008 increased to 19%, from 16% for the comparable prior year period. As a percentage of sales, we expect G&A to decrease in future periods as we continued to leverage our administrative infrastructure and realize the benefits of restructuring activities undertaken throughout 2008 and which are expected to continue in our fourth quarter of 2008.

Interest Expense

Interest expense in 2008 was $0.8 million compared to interest expense of $1.0 million in 2007. The $0.2 million decrease in interest expense was primarily due to a reduction in the principal balance of our 10% secured convertible debt.

Provision for Income Taxes

We have recorded a 100% valuation allowance against our current year tax loss and prior years net operating loss carry forwards based on the criteria contained in FAS 109 of the realized value of these deferred tax assets.
Notwithstanding management's view of future profitability, in determining whether or not a valuation allowance is necessary, forecasts of future taxable income are generally not considered sufficient evidence to outweigh a history of losses.

Liquidity and Capital Resources

Our business requires sufficient capital to cover the costs of product development, production of marketing materials, the purchase of transactional advertising media (such as television, internet, print and radio), and the purchase of product inventory. While a large component of our cash requirements are often associated with advertising media, the terms we receive and the relatively quick return on that investment in the form of product sales associated with those expenditures does not typically result in liquidity constraints. Our biggest capital commitment is the purchase of inventory for sales to our retail chain customers and transactional marketing customers.

In June 2007, we entered into a Loan and Security Agreement (the "BFI Agreement") with BFI Business Finance ("Lender"). Pursuant to the BFI Agreement, Lender will loan us up to the lesser of (i) $5.0 million or (ii) the Borrowing Base. The "Borrowing Base" is defined as (i) 85% of the gross face amount of the eligible accounts receivable of our Adsouth Marketing, LLC subsidiary ("ASM"), plus (ii) 30% of the current market cost of raw materials and finished goods that constitute ASM's eligible inventory, not to exceed the lesser of $700,000 or 50% of the eligible accounts receivable borrowing base. We have guaranteed ASM's obligations under the BFI Agreement. As of September 30, 2008, the balance of the line of credit was $3.6 million, which was approximately 71% of the $5.0 million maximum amount established under the BFI Agreement. We generally run an outstanding balance position as a percentage of available borrowing base of 95% to 100% to support our cash demands. The available borrowing base changes daily influenced by accounts receivable aging, concentration on a customer by customer basis to total accounts receivable, and other factors.

Loans extended pursuant to the BFI Agreement bear interest at a rate per annum of 2.0% above the greater of the prime rate as reported in the western edition of the Wall Street Journal from time to time but never less than 6.5%. Interest is payable monthly in arrears and we are required to pay at least $7,500 a month in interest regardless of the amounts outstanding under the BFI Agreement at any particular time. We are required to pay an annual loan fee equal to 1% of the maximum amount of the credit line. The BFI Agreement has a term of 12 months expiring in June 2009 and thereafter shall automatically renew for successive 12 month periods (each a "Renewal Term") so long as neither we nor Lender delivers written notice of its intention to terminate the BFI Agreement.

As of September 30, 2008, we had a working capital deficit of $3.6 million. Included in the working capital deficit are debt obligations that mature with in one year. The second mortgage balance of $1.1 million on our East Granby Property matures on August 1, 2009. We will seek to extend the maturity date, refinance this obligation or sell the office building on or before the maturity date. Our 10% Secured convertible notes with a balance of $2.6 million requires principal payments through maturity on July 31, 2009. We are currently seeking to refinance this obligation or renegotiate the terms. Based on our anticipated growth, we believe that our cash requirements will increase. We require significant up-front cash disbursements to operate our business, most notably in connection with the purchase of product inventory. Our current working capital resources, comprised of our present cash resources and bank lines of credit, will be insufficient to fund additional growth of our operations over the next 12 months. We will seek to fund additional growth with increases to our credit line by using our receivables and inventory as

collateral, and by seeking alternate debt or equity financing. Securing such financing with favorable terms has been and may remain challenging in the context of the general slowdown of the economy and related global credit crisis. Our failure to raise the necessary additional capital resources or to renegotiate the terms of our debt could affect our ability to generate revenue and could require us to scale down some of our operations.

Net cash used by operations in 2008 was $1.8 million, as compared to $2.5 million used in 2007. The $0.7 million decrease in the use of cash in 2008 was due to: (i) an accounts receivable increase in 2008 of $2.1 million compared to an increase of $3.3 million in 2007, (ii) an inventory decrease in 2008 of $1.1 million compared to an increase of $0.4 million in 2007, (iii) an increase in accounts payable of $0.5 million in 2008, compared to an increase of $1.0 million in 2007, offset by a decrease in earnings of $2.5 million, net of adjustments for non-cash-items.

Net cash provided by financing activities was $2.0 million in 2008 as compared to $2.7 million provided in 2007. The $0.7 million decrease in 2008 was primarily due to a larger use of our credit line in 2008 as compared to the factoring agreements utilized in 2007.

Off Balance Sheet Arrangements

None.

Item 3.