<PAGE>   1
                                                                      EXHIBIT 99

                           IMPORTANT FACTORS THAT MAY
                             AFFECT FUTURE RESULTS

Certain written or oral statements made from time to time by The First Years
Inc. or its representatives in this report, other reports filed with the
Securities & Exchange Commission (the "SEC"), press releases and telephone
conference calls contain forward-looking statements that set out anticipated
results based on management's plans and assumptions. Forward-looking statements
include any statement that may predict, forecast, indicate, or imply future
results or performance and may contain the words "believe," "anticipate,"
"expect," "estimate," "will be," "will continue," "are confident," or words and
phrases with similar meaning. Forward-looking statements involve risks and
uncertainties which may cause actual results to differ materially from the
forward-looking statement. The risks and uncertainties are detailed from time to
time in reports filed by The First Years Inc. with the SEC including Forms 10-Q,
10-K, and 8-K and include, among others, the factors detailed below.

The risks included here are not exclusive. Other sections of this report may
include additional factors which could adversely impact The First Years'
business and financial performance. Moreover, The First Years operates in a very
competitive environment. New risk factors emerge from time to time and it is not
possible for management to predict all such risk factors, nor can it assess the
impact of all such risk factors on The First Years' business or the extent to
which any factor or combination of factors may cause actual results to differ
materially from those contained in any forward-looking statements. Given these
risks and uncertainties, investors should not place undue reliance on
forward-looking statements as a prediction of actual results.

NEED FOR CONTINUED PRODUCT INNOVATION

The growth of the Company has been, and will continue to be, dependent upon its
ability to create new innovative products and to introduce such new products to
the market in a timely fashion. There can be no assurance that the Company will
continue to generate new product ideas, that such products will be brought to
the market in a timely fashion, or that such new products will be well-received
by retailers or consumers. The continued growth of the Company will also depend
in part on the successful introduction of higher-priced products. There can be
no assurance that the Company will be able to successfully develop and introduce
such products.
<PAGE>   2
TIMELINESS OF PRODUCT INTRODUCTIONS

The Company is under increasing pressure to introduce new innovative products
more often and more quickly because the life cycle of many products has
significantly shortened over the last several years. This is due partly to the
ability of competitors to introduce similar products that compete directly with
the Company's successful new products. Timely product introductions are also
essential in the juvenile products industry because the Company's orders are
cancelable by customers and, in some cases, subject to monetary penalties
imposed by customers, if agreed-upon delivery dates are not met. As a result,
the inability to introduce products in a timely fashion could have an adverse
impact on the Company's sales.

RELIANCE ON LICENSED PRODUCTS

A substantial factor contributing to the growth in the Company's net sales in
the past few years has been its sale of products featuring cartoon characters
licensed from other parties, including the use of Winnie the Pooh characters
licensed from Disney Enterprises, Inc. and Sesame Street characters licensed
from The Children's Television Workshop in the USA and in various countries all
over the world. These licenses have fixed terms and limit the type of products
that may be sold under the licenses. A major licensing agreement was renewed in
1999 and will expire at the end of 2000. Sales of products licensed under this
major license amounted to 34% of the Company's total net sales for the year
ended December 31, 1999. While management expects this licensing agreement to be
renewed, non-renewal of this major licensing agreement or renewal on terms not
favorable to the Company could have a material adverse effect on the Company's
business.

DEPENDENCE ON CONSUMER PREFERENCES

The continued success of the Company's business depends in part on the continued
consumer demand for its products and the Company's ability to anticipate, gauge,
and respond to changing consumer demands for juvenile products in a timely
manner. In 1999 the Company experienced a slowdown in sales of its products
featuring cartoon characters licensed from third parties. Changes in consumer
preferences, such as consumers abandoning traditional retailers, shopping on the
internet, general economic decline, or less favorable demographic trends related
to childbirth, among other factors, could have a material adverse effect on the
Company's sales and earnings.

DEPENDENCE UPON A FEW MAJOR CUSTOMERS

The Company's three largest customer, Wal-Mart, Toys "R" Us, and Target
accounted for approximately 28%, 19% and 14% of net sales


                                      -2-
<PAGE>   3
in 1999, respectively. A significant reduction of purchases by any one of these
customers could have a material adverse effect on the Company's sales. There
could also be a negative effect on the Company's business if any significant
customer becomes insolvent or otherwise fails to pay its debts.

CHANGES IN THE RETAIL INDUSTRY

The Company could be materially adversely affected by conditions in the retail
industry in general, including the continuing consolidation in the retail
industry and the resulting decline in the number of retailers, and other
cyclical economic factors. Also, changes in the way retailers and particularly
mass merchandisers do business, such as the creation of competing private-label
brands by such retailers, could result in significant reduction of purchases of
the Company's products by such retailers and thereby have a materially adverse
effect on the Company's sales and earnings.

COMPETITIVE RISKS IN THE JUVENILE PRODUCTS MARKET

Competition is intense in the juvenile products markets in which the Company
sells its products. The Company competes with a large number of other companies
both domestic and foreign, some of which have diversified product lines,
well-known brands and financial, distribution, and marketing and consumer
advertising resources substantially greater than those of the Company. Other
major factors that affect competition in the markets in which the Company
competes include price competition from competitors, and the Company's ability
to maintain or increase the amount of retail shelf space allocated to a
particular product. Also, a major technological breakthrough or marketing
success by a competitor could adversely affect the Company's competitive
position. In addition, in countries where the juvenile products market is
mature, particularly in the USA, sales growth is partly dependent on the
Company's increasing its market share at the expense of its competitors. There
can be no assurance that the Company will be able to continue to compete
effectively in the juvenile products market.

RELIANCE ON CONTRACT AND FOREIGN MANUFACTURERS

The Company does not own or operate its own manufacturing facilities. The
Company depends upon independent manufacturers to manufacture high-quality
products in a timely manner and relies upon the availability of sufficient
production capacity at its existing manufacturers or the ability to utilize
alternative sources of supply. A failure by one or more of the Company's
significant manufacturers to meet established criteria for pricing, product
quality or timeliness could negatively impact the Company's sales and
profitability. In addition, if the Company were to experience significant
shortages in raw materials or

                                      -3-
<PAGE>   4
components used in its products, it could have a negative effect on the
Company's business, including increased cost or difficulty in delivering
products.


A substantial portion of the Company's products sold in 1999 was manufactured in
Asia. The Company is subject to the usual risks of a business involving foreign
suppliers, such as currency fluctuations, government regulation of fund
transfers, export and import duties, trade limitations imposed by the United
States or foreign governments, and political and labor instability. Enactment of
legislation or the imposition of restrictive regulations conditioning or
revoking China's Normal Trade Relations ("NTR") trading status could have a
material adverse effect upon the Company's business because products originating
from China could be subjected to substantially higher rates of duty. Although
the Company continues to evaluate alternative sources of supply outside of
China, there can be no assurance that the Company will be able to develop
alternative sources of supply in a timely and cost-effective manner.

The Company has no long-term manufacturing agreements with its suppliers and
competes with other juvenile product companies, including companies that are
much larger than the Company, for access to production facilities.

The Company, because of its substantial reliance on suppliers in foreign
countries, is required to order products further in advance of customer orders
than would generally be the case if such products were produced in the United
States. The risk of ordering products in this manner is greater during the
initial introduction of new products since it is difficult to determine the
demand for such products.


INVENTORY RISK

Many of the Company's products have relatively long lead times for design and
production of product and thus the Company must commit to production tooling
and to production in advance of orders. If the Company fails to accurately
forecast consumer demand or if there are changes in consumer preferences or
market demand after the Company has made such production commitments, the
Company may encounter difficulty in filling customer orders or in liquidating
excess inventory; may find that retailers are canceling orders or returning
product; and may have to write off the cost of molds for certain unsuccessful
products, all of which may have an adverse effect on the Company's sales, its
margins, profit, and brand image.


COST AND AVAILABILITY OF CERTAIN MATERIALS AND TRANSPORTATION

Plastic, paperboard, other materials, and shipping/transportation costs are
significant cost components of the Company's products


                                      -4-
<PAGE>   5
and packaging. Because the primary resource used in manufacturing plastic is
petroleum, the cost and availability of plastic for use in the Company's
products varies to a great extent with the price of petroleum. The cost of
transporting the Company's products also varies with the cost of oil. High
transportation costs or the inability of the Company's suppliers to acquire
sufficient plastic, paperboard, and other materials at reasonable prices would
adversely affect the Company's ability to maintain its profit margins in the
short term.

RISKS ASSOCIATED WITH INTERNATIONAL SALES

The continued growth of the Company will also depend in part on increasing its
international sales. The Company's international sales in 1999 accounted for
approximately 10.6% of the Company's total net sales. In foreign markets,
particularly the U.K., France, Germany and Canada, the Company competes against
long-established companies with well-known brand names. In these countries
where the juvenile products markets are mature, the Company's sales growth is
particularly dependent on the Company's increasing its market share at the
expense of the well-established local competitors. International sales are also
subject to downturns in the economies and fluctuations in the currencies of
foreign countries, and changes in the economic conditions and buying power of
consumers in foreign markets, particularly in Asia, Russia, Latin and South
America. There can be no assurance that the Company will be successful in
expanding its international sales operations.

PRODUCT LIABILITY RISKS

The Company's juvenile products are used for and by small children and infants.
The Company carries product liability insurance in amounts which management
deems adequate to cover risks associated with such use; however, there can be
no assurance that existing or future insurance coverage will be sufficient to
cover all product liability risks.

IMPACT OF GOVERNMENT REGULATION

Consumer products in general, and in particular products for babies and
infants, are coming under increased regulation both domestically and
internationally. In addition, consumer activist groups are putting increasing
pressure on governments around the world to increase their regulations
regarding the safety of the materials used to make juvenile products for babies
and infants, such as certain kinds of plastic.

The Company's products are subject to the provisions of the Federal Consumer
Safety Act, the Federal Hazardous Substances Act, the Federal Flammable Fabrics
Act, and the Child Safety Protection Act (the "Acts") and the regulations
promulgated thereunder. The



                                      -5-
<PAGE>   6
Acts authorize the Consumer Product Safety Commission (the "CPSC") to protect
the public from products which present a substantial risk of injury. The CPSC
can require the repurchase or recall by the manufacturer of articles which are
found to be defective, and impose fines or penalties on the manufacturer, or to
recommend the recall of products containing chemicals or other materials deemed
by the CPSC to be harmful to children and infants. Similar laws exist in some
states and cities and in other countries in which the Company markets its
products. Any recall of its products could have a material adverse effect on the
Company, depending on the particular product.

YEAR 2000 COMPLIANCE

The Company is dependent on its suppliers and distributors to implement changes
to their computer systems in order to be and remain Year 2000 compliant. The
Company is also dependent on the infrastructure and the utility systems of the
countries in which its products are made and delivered to, to be operating
normally in the year 2000 and beyond. The failure of its suppliers,
distributors, utility companies, shipping carriers and other similar third
parties in the countries in which the Company's products are made or delivered
to be and remain Year 2000 compliant could have a material adverse effect on
the Company's sales and earnings.

BRAND RECOGNITION

A company's brand recognition is becoming increasingly important with consumers
of juvenile products. Some of the Company's competitors have more recognizable
brands than the Company. The Company intends to enhance its brand recognition,
but there can be no assurance that such endeavors will be successful. The
Company's inability to enhance its brand recognition could have a material
adverse impact on the Company's sales.

RISK OF CURRENCY FLUCTUATION

The Company conducts operations in various foreign countries and a portion of
its sales are transacted in local currencies. As a result, the Company's
revenues are subject to foreign exchange rate fluctuations. The Company enters
into forward currency exchange contracts to hedge its exposure. However, no
assurance can be given that fluctuations in foreign currency exchange rates
will not have an adverse impact on the Company's revenues, net profits, or
financial condition.

INTELLECTUAL PROPERTY

From time to time the Company has been and in the future may be the subject of
litigation challenging its ownership of certain intellectual property. Loss of
the Company's principal trademark,

                                      -6-
<PAGE>   7
"The First Years" could have a serious impact on the Company's business. Because
of the importance of the Company's intellectual property, the Company's business
is subject to the risk of claims for intellectual property infringement.

LITIGATION

The Company is subject to the normal risk of litigation with respect to its
business operations and intellectual property.

DEPENDENCE ON KEY PERSONNEL; NEED FOR ADDITIONAL PERSONNEL

The Company is currently dependent upon the ability and experience of its senior
management team and other key employees. The Company is currently in the process
of an executive search to fill certain key positions. Competition for qualified
personnel is intense, and the process of hiring such qualified personnel can be
lengthy. The loss of the services of key personnel or the inability to attract
and retain additional qualified personnel could have an adverse effect on the
Company's operations.


                                      -7-