Unassociated Document
As
filed with the Securities and Exchange Commission on February 18,
2011
Registration
No. 333-_______
U.S.
SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
Form
S-3
REGISTRATION
STATEMENT
UNDER
THE SECURITIES ACT OF 1933
JAKKS
Pacific, Inc.
(Exact
name of registrant as specified in its charter)
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Delaware
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95-4527222
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(State
or other jurisdiction of
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(I.R.S.
Employer
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incorporation
or organization)
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Identification
No.)
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22619
Pacific Coast Highway
Malibu,
California 90265
(310)
456-7799
(Address,
including zip code, and telephone number, including area code, of registrant’s
principal executive offices)
Stephen
G. Berman
Chief
Executive Officer
JAKKS
Pacific, Inc.
22619
Pacific Coast Highway
Malibu,
California 90265
(310)
456-7799
(Name,
address, including zip code, and telephone number, including area code, of agent
for service)
Irving
Rothstein, Esq.
Feder
Kaszovitz LLP
845
Third Avenue
New
York, New York 10022-6601
(212)
888-8200
Fax:
(212) 888-7776
Approximate
date of commencement of proposed sale to the public: From time to time after the effective
date of this registration statement at the discretion of the selling security
holder.
If
the only securities being registered on this Form are being offered pursuant to
dividend or interest reinvestment plans, please check the following box. ¨
If
any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. þ
If
this Form is filed to register additional securities for an offering pursuant to
Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. ¨
If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering. ¨
If
this Form is a registration statement pursuant to General Instruction I.D. or a
post-effective amendment thereto that shall become effective upon filing with
the Commission pursuant to Rule 462(e) under the Securities Act, check the
following box. ¨
If
this Form is a post-effective amendment to a registration statement filed
pursuant to General Instruction I.D. filed to register additional securities or
additional classes of securities pursuant to Rule 413(b) under the Securities
Act, check the following box. ¨
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.
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Large
accelerated filer ¨
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Accelerated
filer þ
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Non-accelerated
filer ¨
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Smaller
reporting company ¨
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(Do
not check if a smaller reporting company)
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CALCULATION
OF REGISTRATION FEE
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Proposed Maximum
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Proposed Maximum
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Title of Each Class of
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Amount to
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Offering Price
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Aggregate Offering
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Amount of
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Securities to be Registered
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be Registered
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per Unit(1)
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Price(1)
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Registration Fee
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Common
Stock, par value $.001 per share
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100,000
Shares
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$ |
17.64 |
(2) |
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$ |
1,764,000 |
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$ |
204.80 |
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(1)
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Estimated
solely for the purpose of computing the amount of the registration fee
pursuant to Rule 457(c).
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(2)
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Pursuant
to Rule 457(c), represents the average of the high and low sales prices of
our common stock for February 15, 2011 as reported on the Nasdaq Global
Select exchange.
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The
registrant hereby amends this registration statement on such date or dates as
may be necessary to delay its effective date until the registrant shall file a
further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act or until the registration statement shall become effective on
such date as the Commission, acting pursuant to said Section 8(a), may
determine.
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THE
INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THE
SELLING SECURITY HOLDER MAY NOT SELL THESE SECURITIES UNTIL THE
REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND
IT IS NOT SOLICITING ANY OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE
THE OFFER OR SALE IS NOT
PERMITTED.
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SUBJECT
TO COMPLETION, DATED FEBRUARY 18, 2011
PROSPECTUS
100,000
Shares
JAKKS
Pacific, Inc.
Common
Stock
This
prospectus relates to 100,000 shares of our common stock, par value $0.001 per
share, issuable upon the exercise of certain outstanding
warrants. The shares may be sold from time to time by the selling
security holder listed under the caption “Selling Security Holder” on page 7.
None of the shares registered herein will be sold for our account and we will
not receive any proceeds from the sale of the common stock. However, if the
selling security holder exercises the warrants we will receive $1,135,000 which
we will use for our general business and corporate purposes. See “Use
of Proceeds.”
The
selling security holder may determine the prices at which it will sell the
common stock, which prices may be at market prices prevailing at the time of
such sale or some other price. The selling security holder may sell
these shares through underwriters, brokers-dealers or agents, who may receive
compensation in the form of discounts, concessions or
commissions. See “Plan of Distribution” or a more complete
description of the ways in which the common stock may be sold.
Our
common stock is traded on the Nasdaq Global Select exchange under the symbol
“JAKK.” On February 17, 2011, the last reported sale price of our common stock
on the Nasdaq Global Select exchange was $18.00 per share.
INVESTING
IN OUR COMMON STOCK INVOLVES RISKS. SEE “RISK FACTORS” ON PAGE 1.
Neither
the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or determined if this prospectus is
truthful and complete. Any representation to the contrary is a criminal
offense.
The date
of this Prospectus
is ,
2011
TABLE OF
CONTENTS
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Page
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Summary
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Risk
Factors
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1
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Forward
Looking Statements
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6
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Use
of Proceeds
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6
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Selling
Security Holder
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6
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Plan
of Distribution
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7
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Legal
Matters
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9
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Experts
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9
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Incorporation
of Documents by Reference
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9
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Where
You Can Find More Information
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10
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Disclosure
of Commission Position on Indemnification For Securities Act
Liabilities
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10
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Exhibit
5.1
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E-5.1-1
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EX-23.1
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E-23.1-1
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ABOUT
THIS PROSPECTUS
This
prospectus constitutes part of a registration statement on Form S-3 that we
filed with the SEC through what is known as the shelf registration process.
Under this process, the selling security holder may sell the securities
described in the prospectus in one or more offerings. This prospectus provides
you with a general description of the securities the selling security holder may
offer. A prospectus supplement may also add, update or change information
contained in this prospectus. You should read both this prospectus and any
prospectus supplement together with additional information described under the
heading “Where You Can Find More Information.”
In
connection with this offering, no person is authorized to give any information
or to make any representations not contained or incorporated by reference in
this prospectus. If information is given or representations are made, you may
not rely on that information or representations as having been authorized by us.
This prospectus is neither an offer to sell nor a solicitation of an offer to
buy any securities other than those registered by this prospectus, nor is it an
offer to sell or a solicitation of an offer to buy securities where an offer or
solicitation would be unlawful. You may not imply from the delivery of this
prospectus, nor from any sale made under this prospectus, that our affairs are
unchanged since the date of this prospectus or that the information contained in
this prospectus is correct as of any time after the date of this prospectus. The
information contained and incorporated by reference in this prospectus and any
accompanying prospectus supplement is accurate only as of the date of this
prospectus or the prospectus supplement or the date of the document incorporated
by reference, as the case may be, regardless of the time of delivery of the
prospectus.
You
should not consider any information in this prospectus to be legal, business or
tax advice. You should consult your own attorney, business advisor and tax
advisor for legal, business and tax advice regarding an investment in our
securities.
SUMMARY
This
summary highlights information contained elsewhere in this prospectus and in
filings with the Securities and Exchange Commission incorporated by reference.
You should carefully read the entire prospectus, including “Risk Factors”
beginning on page 1, as well as any accompanying prospectus supplement and the
documents incorporated herein and therein, before investing in the common stock.
When we use the terms “JAKKS,” “we,” “us,” or “our, ” we are referring to JAKKS
Pacific, Inc. and its subsidiaries, unless the context requires otherwise or we
expressly state otherwise in this prospectus.
JAKKS
Pacific, Inc.
Company
Overview
We are a
leading multi-line, multi-brand toy company that designs, produces, markets and
distributes toys and related products, pet toys, consumables and related
products, electronics and related products, kids indoor and outdoor furniture,
and other consumer products. We focus our business on acquiring or licensing
well-recognized trademarks and brand names, most with long product histories
(“evergreen brands”). We seek to acquire these evergreen brands because we
believe they are less subject to market fads or trends. We also develop
proprietary products marketed under our own trademarks and brand names, and have
historically acquired complementary businesses to further grow our
portfolio. Our products include:
Traditional
Toys
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Action figures and accessories,
including licensed characters, principally based on Ultimate Fighting
Champion, TNA Wrestling and Pokemon®
franchises;
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Toy
vehicles, including Road Champs®, and MXS® toy vehicles
and accessories;
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Electronics products, including
Plug It In
& Play TV Games™, Spy Net products, and
Laser
Challenge®;
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Role-play, dress-up, pretend play
and novelty products for boys and girls based on well known brands and
entertainment properties such as Black &
Decker®, McDonalds®, Dirt
Devil®, Subway®, Pizza
Hut®, Disney
Princess® and Disney
Fairies®, as well as those based on our own proprietary
brands;
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Dolls and accessories, plush,
infant and pre-school toys based on our Child Guidance®, Tollytots brands,
as well as licenses, including Disney
Fairies®,
Cabbage Patch
Kids®, Hello
Kitty®, Disney
Princess®, Graco®
and Fisher Price®;
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Indoor and outdoor kids’
furniture, room décor; kiddie pools and pool toys, seasonal and outdoor
products, including Funnoodle® pool
floats;
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Halloween and everyday costumes
for all ages based on licensed and proprietary non-licensed brands,
including Spiderman®, Iron Man, Toy Story®, Sesame
Street®, Power Rangers® and Disney
Princesses® , and related Halloween
accessories; and
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Private label products as
“exclusives” for a myriad of retail customers in many product
categories.
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Craft,
Activity and Writing Products
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Food play, activity kits,
reusable compounds, including Girl
Gourmet™,
Creepy
Crawlers™ and
Flying
Colors®.
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Pet products, including toys,
consumables, beds, clothing and accessories, branded JAKKS Pets®, some of
which also feature licenses, including American
Kennel Club® and
The Cat
Fanciers’ Association™.
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We
continually review the marketplace to identify and evaluate popular and
evergreen brands and product categories that we believe have the potential for
growth. We endeavor to generate growth within these lines by:
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creating innovative products
under our established licenses and brand
names;
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adding new items to the branded
product lines that we expect will enjoy greater
popularity;
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infusing simple innovation and
technology when appropriate to make them more appealing to today’s
kids;
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linking them with our evergreen
portfolio of brands; and
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focusing our marketing efforts to
enhance consumer recognition and retailer
interest.
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Our
Business Strategy
In
addition to developing our proprietary brands and marks, licensing popular
brands enables us to use these high-profile marks at a lower cost than we would
incur if we purchased these marks or developed comparable marks on our own. By
licensing marks, we have access to a far greater range of marks than would be
available for purchase. We also license technology produced by unaffiliated
inventors and product developers to improve the design and functionality of our
products.
We sell
our products through our in-house sales staff and independent sales
representatives to toy and mass-market retail chain stores, department stores,
office supply stores, drug and grocery store chains, club stores, toy specialty
stores and wholesalers. Our three largest customers are Wal-Mart, Target and
Toys ‘R’ Us, which accounted for approximately 23.2%, 13.7% and 12.2%,
respectively, of our net sales for the nine months ended September 30, 2010. No
other customer accounted for more than 10.0% of our net sales in
2010.
Our
Growth Strategy
Key
elements of our growth strategy include:
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Enter New
Product Categories.
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Pursue
Strategic Acquisitions.
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Acquire
Additional Character and Product Licenses.
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Expand
International Sales.
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Capitalize
On Our Operating Efficiencies.
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The
execution of our growth strategy, however, is subject to several risks and
uncertainties and we cannot assure you that we will continue to experience
growth in, or maintain our present level of net sales (see “Risk Factors,”
beginning on page 1). Moreover, implementation of our growth strategy
is subject to risks beyond our control, including competition, market acceptance
of new products, changes in economic conditions, our ability to obtain or renew
licenses on commercially reasonable terms and our ability to finance increased
levels of accounts receivable and inventory necessary to support our sales
growth, if any.
Furthermore,
we cannot assure you that we can identify attractive acquisition candidates or
negotiate acceptable acquisition terms, and our failure to do so may adversely
affect our results of operations and our ability to sustain growth.
Finally,
our acquisition strategy involves a number of risks, each of which could
adversely affect our operating results, including difficulties in integrating
acquired businesses or product lines, assimilating new facilities and personnel
and harmonizing diverse business strategies and methods of operation; diversion
of management attention from operation of our existing business; loss of key
personnel from acquired companies; and failure of an acquired business to
achieve targeted financial results.
The
Selling Security Holder
On August 15, 2003, we issued to
World Wrestling Entertainment, Inc. (“WWE”) warrants (the “Warrant”) to purchase
100,000 shares of our common stock (the “Shares”) at an exercise price of $11.35
per share. The Warrant is exercisable by WWE (or any subsequent holder of the
Warrant) with respect to all or a portion of the Shares at any time prior to the
expiration of the Warrant on August 14, 2013. WWE has requested us to register
the Shares for offer and sale to the public. The Shares are being offered for
sale through this prospectus by WWE. Only Shares issuable upon the
exercise of the Warrant (and not the Warrant itself) are being registered, and
may be offered and sold, under this prospectus. To sell any Shares, WWE must
first purchase the Shares by exercising the Warrant. To date, WWE has not
exercised the Warrant or any portion thereof.
Our
Corporate Information
We were
formed as a Delaware corporation in 1995. Our principal executive offices are
located at 22619 Pacific Coast Highway, Malibu, California 90265. Our telephone
number is (310) 456-7799. Our Internet website address is www.jakks.com. The
contents of the website are not part of this prospectus, nor is any of its
content incorporated herein.
The
Offering
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Issuer
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JAKKS
Pacific, Inc.
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Seller
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The
selling security holder. For information about the selling security
holder, see “Selling Security Holder.” We are not selling the securities
to the public.
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Securities
Offered
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100,000
shares of our common stock, par value $.001.
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Common
Stock to be Outstanding After the
Offering(1)
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27,791,379
shares.
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Registration
Rights
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We
are agreeing to use our best efforts keep the registration statement, of
which this prospectus forms a part, effective until the earlier to occur
of (i) the date on which the registered shares are disposed of in
accordance with this prospectus or (ii) the date when the registered
shares can be immediately sold to the public without registration or
restriction.
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Trading
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Our common stock
trades on the Nasdaq Global Select exchange under the symbol “JAKK.”
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Risk
Factors
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See
“Risk Factors” beginning on page 1 for a discussion of factors you should
carefully consider before deciding to invest in our common
stock.
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Use
of Proceeds
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We
will not receive any of the proceeds from the sale by the selling security
holder of the shares of common stock. However, if the selling
security holder exercises the warrants we will receive $1,135,000 which we
will use for our general business and corporate
purposes.
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(1)
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Does
not include (1) 6,320,910 shares underlying our convertible notes; and (2)
318,265 shares underlying our outstanding options.
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RISK
FACTORS
An
investment in the shares of common stock involves significant risks. In addition
to reviewing other information in this prospectus and any accompanying
prospectus supplement and the documents incorporated herein and therein, you
should carefully consider the following factors before deciding to purchase the
shares of common stock, as well as the risk factors referred in any accompanying
prospectus supplement and the documents incorporated herein and therein. If any
of these risks actually occur, our business, results of operations and financial
condition could be materially adversely affected and you
might lose all or part of your investment.
Our
inability to redesign, restyle and extend our existing core products and product
lines as consumer preferences evolve, and to develop, introduce and gain
customer acceptance of new products and product lines, may materially and
adversely impact our business, financial condition and results of
operations.
Our
business and operating results depend largely upon the appeal of our products.
Our continued success in the toy industry will depend on our ability to
redesign, restyle and extend our existing core products and product lines as
consumer preferences evolve, and to develop, introduce and gain customer
acceptance of new products and product lines. Several trends in recent years
have presented challenges for the toy industry, including:
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Age Compression: The
phenomenon of children outgrowing toys at younger ages, particularly in
favor of interactive and high technology
products;
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Increasing use of
technology;
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Shorter life cycles for
individual products; and
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Higher consumer expectations
for product quality, functionality and
value.
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We cannot
assure you that:
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our current products will
continue to be popular with
consumers;
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the product lines or products
that we introduce will achieve any significant degree of market
acceptance; or
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the life cycles of our
products will be sufficient to permit us to recover licensing, design,
manufacturing, marketing and other costs associated with those
products.
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Our
failure to achieve any or all of the foregoing benchmarks may cause the
infrastructure of our operations to fail, thereby adversely affecting our
business, financial condition and results of operations.
The
failure of our character-related and theme-related products to become and/or
remain popular with children may materially and adversely impact our business,
financial condition and results of operations.
The
success of many of our character-related and theme-related products depends on
the popularity of characters in movies, television programs, live wrestling
exhibitions, auto racing events and other media. We cannot assure you
that:
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media associated with our
character-related and theme-related product lines will be released at the
times we expect or will be
successful;
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the success of media
associated with our existing character-related and theme-related product
lines will result in substantial promotional value to our
products;
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we will be successful in
renewing licenses upon expiration on terms that are favorable to us;
or
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we will be successful in
obtaining licenses to produce new character-related and theme-related
products in the future.
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Our
failure to achieve any or all of the foregoing benchmarks may cause the
infrastructure of our operations to fail, thereby adversely affecting our
business, financial condition and results of operations.
There
are risks associated with our license agreements.
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Our current licenses require
us to pay minimum royalties
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Sales of
products under trademarks or trade or brand names licensed from others account
for substantially all of our net sales. Product licenses allow us to capitalize
on characters, designs, concepts and inventions owned by others or developed by
toy inventors and designers. Our license agreements generally require us to make
specified minimum royalty payments, even if we fail to sell a sufficient number
of units to cover these amounts. In addition, under certain of our license
agreements, if we fail to achieve certain prescribed sales targets, we may be
unable to retain or renew these licenses.
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Some of our licenses are
restricted as to use
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Under the
majority of our license agreements the licensors have the right to review and
approve our use of their licensed products, designs or materials before we may
make any sales. If a licensor refuses to permit our use of any licensed property
in the way we propose, or if their review process is delayed, our development or
sale of new products could be impeded.
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New licenses are difficult and
expensive to obtain
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Our
continued success will depend substantially on our ability to obtain additional
licenses. Intensive competition exists for desirable licenses in our industry.
We cannot assure you that we will be able to secure or renew significant
licenses on terms acceptable to us. In addition, as we add licenses, the need to
fund additional royalty advances and guaranteed minimum royalty payments may
strain our cash resources.
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A limited number of licensors
account for a large portion of our net
sales
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We derive
a significant portion of our net sales from a limited number of licensors. If
one or more of these licensors were to terminate or fail to renew our license or
not grant us new licenses, our business, financial condition and results of
operations could be adversely affected.
The
toy industry is highly competitive and our inability to compete effectively may
materially and adversely impact our business, financial condition and results of
operations.
The toy
industry is highly competitive. Globally, certain of our competitors have
financial and strategic advantages over us, including:
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greater financial
resources;
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larger sales, marketing and
product development
departments;
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stronger name
recognition;
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longer operating histories;
and
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greater economies of
scale.
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In
addition, the toy industry has no significant barriers to entry. Competition is
based primarily on the ability to design and develop new toys, to procure
licenses for popular characters and trademarks and to successfully market
products. Many of our competitors offer similar products or alternatives to our
products. Our competitors have obtained and are likely to continue to obtain
licenses that overlap our licenses with respect to products, geographic areas
and markets. We cannot assure you that we will be able to obtain adequate shelf
space in retail stores to support our existing products or to expand our
products and product lines or that we will be able to continue to compete
effectively against current and future competitors.
We
may not be able to sustain or manage our growth, which may prevent us from
continuing to increase our net revenues.
We have
experienced rapid growth in our product lines resulting in higher net sales over
the last nine years, which was achieved through acquisitions of businesses,
products and licenses. For example, revenues associated with companies we
acquired since 2008 were approximately $169.0 million and $169.6 million, for
the year ended December 31, 2009 and the nine months ended September 30, 2010,
respectively, representing 21.0% and 30.9% of our total revenues for those
periods. As a result, comparing our period-to-period operating results may not
be meaningful and results of operations from prior periods may not be indicative
of future results. We cannot assure you that we will continue to experience
growth in, or maintain our present level of, net sales.
Our
growth strategy calls for us to continuously develop and diversify our toy
business by acquiring other companies, entering into additional license
agreements, refining our product lines and expanding into international markets,
which will place additional demands on our management, operational capacity and
financial resources and systems. The increased demand on management may
necessitate our recruitment and retention of qualified management personnel. We
cannot assure you that we will be able to recruit and retain qualified personnel
or expand and manage our operations effectively and profitably. To effectively
manage future growth, we must continue to expand our operational, financial and
management information systems and to train, motivate and manage our work force.
There can be no assurance that our operational, financial and management
information systems will be adequate to support our future operations. Failure
to expand our operational, financial and management information systems or to
train, motivate or manage employees could have a material adverse effect on our
business, financial condition and results of operations.
In
addition, implementation of our growth strategy is subject to risks beyond our
control, including competition, market acceptance of new products, changes in
economic conditions, our ability to obtain or renew licenses with commercially
reasonable terms and our ability to finance increased levels of accounts
receivable and inventory necessary to support our sales growth, if any.
Accordingly, we cannot assure you that our growth strategy will continue to be
implemented successfully.
If
we are unable to acquire and integrate companies and new product lines
successfully, we will be unable to implement a significant component of our
growth strategy.
Our
growth strategy depends in part upon our ability to acquire companies and new
product lines. Revenues associated with our acquisitions since 2008 represented
approximately 21.0% and 30.9% of our total revenues for the year ended December
31, 2009 and the nine months ended September 30, 2010, respectively. Future
acquisitions will succeed only if we can effectively assess characteristics of
potential target companies and product lines, such as:
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attractiveness of
products;
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suitability of distribution
channels;
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financial condition and
results of operations; and
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the degree to which acquired
operations can be integrated with our
operations.
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We cannot
assure you that we can identify attractive acquisition candidates or negotiate
acceptable acquisition terms, and our failure to do so may adversely affect our
results of operations and our ability to sustain growth. Our acquisition
strategy involves a number of risks, each of which could adversely affect our
operating results, including:
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difficulties in integrating
acquired businesses or product lines, assimilating new facilities and
personnel and harmonizing diverse business strategies and methods of
operation;
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diversion of management
attention from operation of our existing
business;
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loss of key personnel from
acquired companies; and
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failure of an acquired
business to achieve targeted financial
results.
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A
limited number of customers account for a large portion of our net sales, so
that if one or more of our major customers were to experience difficulties in
fulfilling their obligations to us, cease doing business with us, significantly
reduce the amount of their purchases from us or return substantial amounts of
our products, it could have a material adverse effect on our business, financial
condition and results of operations.
Our three
largest customers accounted for 49.1% and 55.6% of our net sales for the nine
months ended September 30, 2010 and the year ended December 31, 2009,
respectively. Except for outstanding purchase orders for specific products, we
do not have written contracts with or commitments from any of our customers. A
substantial reduction in or termination of orders from any of our largest
customers could adversely affect our business, financial condition and results
of operations. In addition, pressure by large customers seeking price
reductions, financial incentives, changes in other terms of sale or for us to
bear the risks and the cost of carrying inventory also could adversely affect
our business, financial condition and results of operations. If one or more of
our major customers were to experience difficulties in fulfilling their
obligations to us, cease doing business with us, significantly reduce the amount
of their purchases from us or return substantial amounts of our products, it
could have a material adverse effect on our business, financial condition and
results of operations. In addition, the bankruptcy or other lack of success of
one or more of our significant retailers could negatively impact our revenues
and bad debt expense.
We
depend on our key personnel and any loss or interruption of either of their
services could adversely affect our business, financial condition and results of
operations.
Our
success is largely dependent upon the experience and continued services of
Stephen G. Berman, our President and Chief Executive Officer. We cannot assure
you that we would be able to find an appropriate replacement for Mr. Berman if
the need should arise, and any loss or interruption of Mr. Berman’s services
could adversely affect our business, financial condition and results of
operations.
We
depend on third-party manufacturers, and if our relationship with any of them is
harmed or if they independently encounter difficulties in their manufacturing
processes, we could experience product defects, production delays, cost overruns
or the inability to fulfill orders on a timely basis, any of which could
adversely affect our business, financial condition and results of
operations.
We depend
on many third-party manufacturers who develop, provide and use the tools, dies
and molds that we own to manufacture our products. However, we have limited
control over the manufacturing processes themselves. As a result, any
difficulties encountered by the third-party manufacturers that result in product
defects, production delays, cost overruns or the inability to fulfill orders on
a timely basis could adversely affect our business, financial condition and
results of operations.
We do not
have long-term contracts with our third-party manufacturers. Although we believe
we could secure other third-party manufacturers to produce our products, our
operations would be adversely affected if we lost our relationship with any of
our current suppliers or if our current suppliers’ operations or sea or air
transportation with our overseas manufacturers were disrupted or terminated even
for a relatively short period of time. Our tools, dies and molds are located at
the facilities of our third-party manufacturers.
Although
we do not purchase the raw materials used to manufacture our products, we are
potentially subject to variations in the prices we pay our third-party
manufacturers for products, depending on what they pay for their raw
materials.
We
have substantial sales and manufacturing operations outside of the United States
subjecting us to risks common to international operations.
We sell
products and operate facilities in numerous countries outside the United States.
For the nine months ended September 30, 2010 and the year ended December 31,
2009 sales to our international customers comprised approximately 15.8% and
16.5%, respectively, of our net sales. We expect our sales to international
customers to account for a greater portion of our revenues in future fiscal
periods. Additionally, we utilize third-party manufacturers located principally
in China which are subject to the risks normally associated with international
operations, including:
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currency conversion risks and
currency fluctuations;
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limitations, including taxes,
on the repatriation of
earnings;
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political instability, civil
unrest and economic
instability;
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greater difficulty enforcing
intellectual property rights and weaker laws protecting such
rights;
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complications in complying
with laws in varying jurisdictions and changes in governmental
policies;
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greater difficulty and
expenses associated with recovering from natural
disasters;
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transportation delays and
interruptions;
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the potential imposition of
tariffs; and
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the pricing of intercompany
transactions may be challenged by taxing authorities in both Hong Kong and
the United States, with potential increases in income
taxes.
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Our
reliance on external sources of manufacturing can be shifted, over a period of
time, to alternative sources of supply, should such changes be necessary.
However, if we were prevented from obtaining products or components for a
material portion of our product line due to medical, political, labor or other
factors beyond our control, our operations would be disrupted while alternative
sources of products were secured. Also, the imposition of trade sanctions by the
United States against a class of products imported by us from, or the loss of
“normal trade relations” status by China, could significantly increase our cost
of products imported from that nation. Because of the importance of our
international sales and international sourcing of manufacturing to our business,
our financial condition and results of operations could be significantly and
adversely affected if any of the risks described above were to
occur.
Our
business is subject to extensive government regulation and any violation by us
of such regulations could result in product liability claims, loss of sales,
diversion of resources, damage to our reputation, increased warranty costs or
removal of our products from the market, and we cannot assure you that our
product liability insurance for the foregoing will be sufficient.
Our
business is subject to various laws, including the Federal Hazardous Substances
Act, the Consumer Product Safety Act, the Flammable Fabrics Act and the rules
and regulations promulgated under these acts. These statutes are administered by
the Consumer Products Safety Commission (“CPSC”), which has the authority to
remove from the market products that are found to be defective and present a
substantial hazard or risk of serious injury or death. The CPSC can require a
manufacturer to recall, repair or replace these products under certain
circumstances. We cannot assure you that defects in our products will not be
alleged or found. Any such allegations or findings could result in:
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product liability
claims;
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diversion of
resources;
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damage to our
reputation;
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increased warranty and
insurance costs; and
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removal of our products from
the market.
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Any of
these results may adversely affect our business, financial condition and results
of operations. There can be no assurance that our product liability insurance
will be sufficient to avoid or limit our loss in the event of an adverse outcome
of any product liability claim.
We
depend on our proprietary rights, and our inability to safeguard and maintain
the same, or claims of third parties that we have violated their intellectual
property rights, could have a material adverse effect on our business, financial
condition and results of operations.
We rely
on trademark, copyright and trade secret protection, nondisclosure agreements
and licensing arrangements to establish, protect and enforce our proprietary
rights in our products. The laws of certain foreign countries may not protect
intellectual property rights to the same extent or in the same manner as the
laws of the United States. We cannot assure you that we or our licensors will be
able to successfully safeguard and maintain our proprietary rights. Further,
certain parties have commenced legal proceedings or made claims against us based
on our alleged patent infringement, misappropriation of trade secrets or other
violations of their intellectual property rights. We cannot assure you that
other parties will not assert intellectual property claims against us in the
future. These claims could divert our attention from operating our business or
result in unanticipated legal and other costs, which could adversely affect our
business, financial condition and results of operations.
Market
conditions and other third-party conduct could negatively impact our margins and
implementation of other business initiatives.
Economic
conditions, such as rising fuel prices, increased competition and decreased
consumer confidence, may adversely impact our margins. Such a weakened economic
and business climate could create uncertainty and adversely affect our sales and
profitability. Other conditions, such as the unavailability of electronics
components, may impede our ability to manufacture, source and ship new and
continuing products on a timely basis. Significant and sustained increases in
the price of oil could adversely impact the cost of the raw materials used in
the manufacture of our products, such as plastic.
The
outcome of litigation in which we have been named as a defendant is
unpredictable and a materially adverse decision in any such matter could have a
material adverse affect on our financial position and results of
operations.
We are
defendants in litigation matters, as described under “Legal Proceedings” in our
periodic reports filed pursuant to the Securities Exchange Act of 1934. These
claims may divert financial and management resources that would otherwise be
used to benefit our operations. Although we believe that we have meritorious
defenses to the claims made in each and all of the litigation matters to which
we have been named a party, and intend to contest each lawsuit vigorously, we
can provide no assurances that the results of these matters will be favorable to
us. A materially adverse resolution of any of these lawsuits could have a
material adverse affect on our financial position and results of
operations.
FORWARD
LOOKING STATEMENTS
This
prospectus includes or incorporates by reference, and any prospectus supplement
will include or incorporate by reference, “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the
Securities Exchange Act of 1934. For example, statements included in this
prospectus and any prospectus supplement regarding our financial position,
business strategy and other plans and objectives for future operations, and
assumptions and predictions about future product demand, supply, manufacturing,
costs, marketing and pricing factors are all forward-looking statements. When we
use words like “intend,” “anticipate,” “believe,” “estimate,” “plan,” “will” or
“expect,” we are making forward-looking statements. We believe that the
assumptions and expectations reflected in such forward-looking statements are
reasonable, based on information available to us on the date hereof, but we
cannot assure you that these assumptions and expectations will prove to have
been correct or that we will take any action that we may presently be planning.
We have disclosed certain important factors that could cause our actual results
to differ materially from our current expectations under “Risk Factors” above
and elsewhere in our incorporated filings. You should understand that
forward-looking statements made in this prospectus, any accompanying prospectus
supplement and the documents incorporated herein and therein, are necessarily
qualified by these factors. We are not undertaking to publicly update or revise
any forward-looking statement if we obtain information or upon the occurrence of
future events or otherwise.
USE
OF PROCEEDS
None of
the Shares are to be sold by us or for our account, and we will not receive any
proceeds from the sale thereof. The 100,000 Shares are issuable upon the
exercise of the Warrant at an exercise price of $11.35 per share. Only
outstanding Shares issued upon the exercise of the Warrant may be offered or
sold hereunder. Accordingly, assuming that the Warrant is exercised in full at
the currently applicable exercise price, we would receive proceeds of $1,135,000
from the issuance and sale of such Shares to the holder of the Warrant. The
proceeds we receive from the exercise of the Warrant, if the Warrant is
exercised, are expected to be used for general working capital.
SELLING
SECURITY HOLDER
WWE can
exercise the Warrant to purchase up to 100,000 Shares, all of which may be
offered from time to time through this prospectus by WWE or for its account. On
the date of this prospectus, WWE does not beneficially own any outstanding
shares of our common stock, other than the 100,000 shares underlying the
Warrant.
WWE had
granted us a license pursuant to which we had the exclusive world-wide right to
develop and market an extensive line of toy products based on WWE's wrestling
characters and themes. Our wrestling toy line included articulated action
figures, soft-body figures, wrestling ring play-sets and
accessories. During the life of the license, sales of our
WWE-licensed wrestling products represented a substantial portion of our annual
net sales. In addition, our joint venture with THQ operated under a license
agreement with WWE, pursuant to which WWE had granted the joint venture the
exclusive world-wide right to publish WWE video games on all hardware
platforms. Pursuant to the terms of an Agreement of Dismissal,
Release and Settlement dated as of December 29, 2009, we no longer have any
rights to these licenses.
As used
herein, the term selling security holder includes WWE’s transferees, pledgees or
donees, or their successors, selling shares received after the date of this
prospectus. A selling security holder may from time to time offer and sell
pursuant to this prospectus any or all of the 100,000 shares of common stock
offered hereby.
Information
regarding the selling security holder may change from time to time. Any such
change will be set forth in supplements to this prospectus if and when
necessary.
PLAN
OF DISTRIBUTION
The
Shares may be offered from time to time by WWE, which holds the Warrant
exercisable for an aggregate of 100,000 Shares. The Warrant is not being offered
hereby; only Shares issuable upon the exercise thereof may be offered or sold
hereunder. We cannot assure you that WWE will exercise the Warrant, or, if it
does, that it will sell any or all of the Shares so purchased by it under this
prospectus. No Shares are being offered or sold by us or for our account and we
will not receive any proceeds from the sale of the Shares. We will bear all
costs associated with the offering and sale of the Shares, other than any
underwriting discounts, agency fees, brokerage commissions or similar costs
applicable to the sale of any Shares. These costs will be borne by the holder of
the Shares sold hereunder. We have also agreed to indemnify WWE and, if
applicable, certain other participants in the offering against certain
liabilities under the Securities Act of 1933 or to contribute to payments they
may be required to make with respect thereto.
The
Shares could be sold by one or more of the following methods, without
limitation:
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privately
negotiated transactions;
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ordinary
brokerage transactions and transactions in which the broker solicits
purchases;
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through
one or more underwritten offerings on a firm commitment or best efforts
basis;
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block
trades in which the broker or dealer so engaged will attempt to sell the
Shares as agent but may position and resell a portion of the block as
principal to facilitate the
transaction;
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purchases
by a broker or dealer as principal and resale by the broker or dealer for
its own account pursuant to this
prospectus;
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through
the writing of options on the Shares, whether or not the options are
listed on an options exchange;
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an
exchange distribution in accordance with the rules of any stock exchange
on which the Shares are listed; or
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any
combination of any of these methods of
sale.
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A holder
of the Shares may effect transactions by selling the Shares directly to
purchasers or through or to brokers or dealers, and brokers or dealers may
receive compensation in the form of commissions, discounts or concessions from
the selling holder or from the purchasers of the Shares for whom they may act as
agent or to whom they may sell as principal, or both (which compensation as to a
particular broker or dealer may be in excess of customary commissions). Any
brokers and dealers engaged by a selling holder may arrange for other brokers or
dealers to participate in effecting sales of the Shares. These
brokers or dealers may act as principals, or as agents of a selling holder.
Broker-dealers may agree with a selling holder to sell a specified number of
Shares at a stipulated price per share. If the broker-dealer is unable to sell
Shares acting as agent for a selling holder, it may purchase as principal any
unsold Shares at the stipulated price. Broker-dealers who acquire Shares as
principals may thereafter resell the Shares from time to time in transactions on
any stock exchange or automated interdealer quotation system on which the Shares
are then listed, at prices and on terms then prevailing at the time of sale, at
prices related to the then-current market price or in negotiated transactions.
Broker-dealers may use block transactions and sales to and through
broker-dealers, including transactions of the nature described
above.
Any
of the Shares which qualify for sale pursuant to Rule 144 or Rule 144A under the
Securities Act of 1933 may be sold under those rules rather than under this
prospectus.
A
selling holder may enter into hedging transactions with broker-dealers, and the
broker-dealers may engage in short sales of the Shares in the course of hedging
the positions they assume with that selling holder, including without limitation
in connection with distributions of the Shares by those broker-dealers. A
selling holder may enter into option or other transactions with broker-dealers
that involve the delivery of the Shares offered hereby to the broker-dealers,
who may then resell or otherwise transfer those Shares pursuant to this
prospectus (as supplemented or amended to reflect that transaction). In
addition, a selling holder may, from time to time, sell the shares short, and in
those instances, this prospectus may be delivered in connection with the short
sales and the Shares offered under this prospectus may be used to cover short
sales. A selling holder may also pledge the Shares offered hereby to a
broker-dealer or other financial institution, and, upon a default, the
broker-dealer or other financial institution may effect sales of the pledged
Shares under this prospectus (if required, as supplemented or amended to reflect
those transactions).
At
the time a particular offering of the Shares is made, if required, a prospectus
supplement will be distributed that will set forth the number of Shares being so
offered and the terms of the offering, including the name or names of any
underwriters, brokers, dealers or agents, the purchase price paid by any
underwriter for Shares purchased, any discounts, commissions and other
compensation and any discounts, commissions or concessions allowed or reallowed
or paid to dealers, and the proposed selling price to the public. Any
underwriters, brokers, dealers or agents who participate in the distribution of
such Shares may be deemed to be "underwriters" under the Securities Act, and any
discounts, commissions or concessions received by them may be deemed to be
underwriting compensation under the Securities Act.
In
connection with this offering, an underwriter may engage in transactions on the
Nasdaq National Market that stabilize, maintain or otherwise affect the price of
our common stock. Specifically, an underwriter may over-allot this offering,
creating a syndicate short position. An underwriter may bid for and purchase
shares of our common stock in the open market to cover this syndicate short
position or to stabilize the price of our common stock. In addition, an
underwriting syndicate may reclaim selling concessions from syndicate members
and selected dealers if a participating underwriter repurchases previously
distributed common stock in syndicate covering transactions, in stabilization
transactions or otherwise, or if a participating underwriter receives a report
that indicates that the clients of such syndicate members have "flipped" the
common stock. Also, in connection with this offering, certain underwriters and
selling group members (if any) who are qualified market makers on the Nasdaq
National Market may engage in passive market making transactions in our common
stock on the Nasdaq National Market in accordance with Rule 103 of Regulation M
under the Exchange Act. Passive market makers must comply with applicable volume
and price limitations and must be identified as such. In general, a passive
market maker must display its bid at a price not in excess of the highest
independent bid for such security; if all independent bids are lowered below the
passive market maker's bid, however, its bid must then be lowered when certain
purchase limits are exceeded. These activities may stabilize or maintain the
market price of our common stock at a level above that which might otherwise
prevail in the open market. The underwriters are not required to engage in these
activities and may end any of these activities at any time.
In order
to comply with the securities laws of some states, if applicable, the common
stock may be sold in these jurisdictions only through registered or licensed
brokers or dealers. In addition, in some states the common stock may not be sold
unless they have been registered or qualified for sale or an exemption from
registration or qualification requirements is available and is complied
with.
The
selling security holders and any underwriters, broker-dealers or agents that
participate in the sale of the common stock may be “underwriters” within the
meaning of Section 2(11) of the Securities Act. Any discounts, commissions,
concessions or profit they earn on any resale of the shares may be deemed to be
underwriting discounts and commissions under the Securities Act.
A selling
security holder who is an “underwriter” within the meaning of Section 2(11) of
the Securities Act will be subject to the prospectus delivery requirements of
the Securities Act and may be subject to statutory liabilities, including, but
not limited to, liability under Sections 11, 12 and 17 of the Securities Act and
Rule 10b-5 under the Securities Exchange Act of 1934. The selling security
holder has acknowledged that it understands its obligations to comply with the
provisions of the Exchange Act and the rules thereunder relating to stock
manipulation, particularly Regulation M.
To our
knowledge, there are currently no plans, arrangements or understandings between
the selling security holder and any underwriter, broker-dealer or agent
regarding the sale of the common stock. The selling security holder may not sell
any common stock described in this prospectus and may not transfer, devise or
gift these securities by other means not described in this prospectus. In
addition, any securities covered by this prospectus which qualify for sale
pursuant to Rule 144 or Rule 144A of the Securities Act may be sold under Rule
144 or Rule 144A rather than pursuant to this prospectus.
We are
obligated to use our reasonable best efforts to keep the registration statement
of which this prospectus is a part effective until the earlier to occur of (i)
the date when all of the securities registered hereby are disposed of in
accordance with the terms of the shelf registration statement or (ii) the date
when the registered shares can be immediately sold to the public without
registration or restriction.
Our
obligation to keep the shelf registration statement to which this prospectus
relates effective is subject to specified, permitted exceptions. In
these cases, we may prohibit offers and sales of the shares of common stock
pursuant to the registration statement to which this prospectus
relates.
When we
are notified by any selling security holder that any material arrangement has
been entered into with a broker-dealer for the sale of the common stock covered
by this prospectus through a block trade, special offering, exchange
distribution or secondary distribution or purchase by a broker or dealer, we
will file a supplement to this prospectus, if required, pursuant to Rule 424(b)
under the Securities Act, or, if appropriate, a post-effective amendment to the
registration statement of which this prospectus forms a part, disclosing (a) the
name of the such selling security holder and of the participating broker-dealer
or dealers, (b) the number of shares of common stock involved, (c) the price at
which the common stock was sold, (d) the commissions paid or discounts or
concessions allowed to such broker-dealer or dealers, if applicable, and (e)
other facts material to the transaction. In addition, when we are notified by
any selling security holder that a donee or pledgee intends to sell more than
500 shares, a supplement to this prospectus will be filed.
We may
suspend the use of this prospectus if we learn of any event that causes this
prospectus to include an untrue statement of a material fact required to be
stated in the prospectus or necessary to make the statements in the prospectus
not misleading in light of the circumstances then existing. If this type of
event occurs, a prospectus supplement or post-effective amendment, if required,
will be distributed to each selling security holder. The selling security holder
may not trade securities from the time the selling security holder receives
notice from us of this type of event until the selling security holder receives
a prospectus supplement or amendment.
LEGAL
MATTERS
The
legality of the common stock being offered hereby will be passed upon for us by
Feder Kaszovitz LLP, New York, New York. Murray L. Skala, a partner of that
firm, is one of our directors, an owner of 37,822 shares of our common stock and
a holder of options to purchase 37,500 shares of our common stock.
EXPERTS
The
financial statements and schedule as of December 31, 2009 and 2008 and for each
of the three years in the period ended December 31, 2009 and management's
assessment of the effectiveness of internal control over financial reporting as
of December 31, 2009 incorporated by reference in this Prospectus have been so
incorporated in reliance on the reports of BDO Seidman, LLP, an independent
registered public accounting firm, incorporated herein by reference, given on
the authority of said firm as experts in auditing and accounting.
INCORPORATION
OF DOCUMENTS BY REFERENCE
This
prospectus “incorporates by reference” certain of the reports and other
information that we have filed with the SEC under the Exchange Act. This means
that we are disclosing important information to you by referring you to those
documents. Information filed with the SEC after the date of this prospectus will
update and supersede this information. The following documents filed with the
SEC are incorporated by reference (other than information in such documents that
is deemed, in accordance with SEC rules, to have been furnished and not
filed):
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Our
Annual Report on Form 10-K for the year ended December 31,
2009;
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(2)
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Our
Quarterly Reports on Form 10-Q for the quarters ended March 31, June 30,
and September 30, 2010;
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(3)
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Our
Current Reports on Form 8-K filed with the SEC on March 2, April 22, July
22, July 29, August, 26, October 6, October 26, and November 17, 2010 and
February 15, 2011; and
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(4)
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The
description of our common stock contained in our Registration Statement on
Form 8-A (File No. 0-28104), filed March 29, 1996, and as incorporated
therein by reference to our Registration Statement on Form SB-2 (Reg. No.
333-2048-LA).
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Any
future filings we make with the SEC (other than information in such documents
that is deemed, in accordance with SEC rules, to have been furnished and not
filed) under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act (File No.
0-28104) after the date hereof are incorporated by reference until all of the
securities offered by this prospectus are sold. Any statement contained in this
prospectus or in a document incorporated by reference shall be deemed to be
modified or superseded for all purposes to the extent that a later statement
contained in those documents modifies or supersedes that earlier statement. Any
statements so modified or superseded will not be deemed to constitute a part of
this prospectus except as so modified or superseded. In addition, any supplement
prepared in relation to this prospectus shall be deemed to supersede for all
purposes any earlier supplement prepared in relation to this
prospectus.
We will
provide each person to whom a copy of this prospectus has been delivered,
without charge, a copy of any of the documents referred to above as being
incorporated by reference. You may request a copy by writing or telephoning Joel
M. Bennett, c/o JAKKS Pacific, Inc., 22619 Pacific Coast Highway, Malibu,
California, 90265 (telephone: 310-456-7799).
WHERE
YOU CAN FIND MORE INFORMATION
We have
filed with the SEC a “shelf” registration statement on Form S-3 under the
Securities Act relating to the resale of the Shares offered by this
prospectus. This prospectus is part of that registration statement,
but does not contain all of the information in the registration
statement. We have omitted parts of the registration statement in
accordance with the rules and regulations of the SEC. For more detail
about us and any securities that may be offered by this prospectus, you may
examine the registration statement on Form S-3 and the exhibits filed or
incorporated by reference into the registration statement at the locations
listed below.
We are
subject to the information requirements of the Securities Exchange Act of 1934.
In accordance with the Exchange Act, we file reports, proxy statement and other
information with the SEC. Such reports, proxy statements and other information
can be inspected and copied at prescribed rates at the SEC’s public reference
room at 100 F Street, N.E., Washington, D.C. 20549. The SEC also maintains a
website at http://www.sec.gov
that contains reports, proxy and information statements and other information.
Please call the SEC at 1-800-SEC-0330 for further information on the Public
Reference Room. Our common stock is listed on the Nasdaq National Market and
reports and information concerning us can also be inspected through such
exchange. We intend to furnish our stockholders with annual reports containing
audited financial statements and such other periodic reports as we deem
appropriate or as may be required by law.
DISCLOSURE
OF COMMISSION POSITION ON
INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
Our
certificate of incorporation provides that the personal liability of our
directors shall be limited to the fullest extent permitted by the provisions of
Section 102(b)(7) of the General Corporation Law of the State of Delaware
(“DGCL”). Section 102(b)(7) of the DGCL generally provides that no director
shall be liable personally to a company or its security holders for monetary
damages for breach of fiduciary duty as a director, provided that the
certificate of incorporation does not eliminate the liability of a director for
(1) any breach of the director’s duty of loyalty to it or its security holders;
(2) acts or omissions not in good faith or that involve intentional misconduct
or a knowing violation of law; (3) acts or omissions in respect of certain
unlawful dividend payments or stock redemptions or repurchases; or (4) any
transaction from which such director derives an improper personal benefit. The
effect of this provision is to eliminate the rights of a company and its
security holders to recover monetary damages against a director for breach of
her or his fiduciary duty of care as a director (including breaches resulting
from negligent or grossly negligent behavior) except in the situations described
in clauses (1) through (4) above. The limitations summarized above, however, do
not affect the ability of a company or its security holders to seek nonmonetary
remedies, such as an injunction or rescission, against a director for breach of
her or his fiduciary duty.
In
addition, our certificate of incorporation provides that we shall, to the
fullest extent permitted by Section 145 of the DGCL, indemnify all persons whom
it may indemnify pursuant to Section 145 of the DGCL. In general, Section 145 of
the DGCL permits us to indemnify our directors, officers, employees or agents
or, when so serving at our request, another company who was or is a party or is
threatened to be made a party to any proceeding because of his or her position,
if he or she acted in good faith and in a manner reasonably believed to be in or
not opposed to our best interests and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his or her conduct was
unlawful.
We
maintain a directors’ and officers’ liability insurance policy covering certain
liabilities that may be incurred by any director or officer in connection with
the performance of his or her duties and certain liabilities that we may incur,
including the indemnification payable to any director or officer. This policy
provides for $60 million in maximum aggregate coverage, including defense costs.
We pay the entire premium for such insurance.
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may
be permitted to our directors, officers, or persons controlling us pursuant to
the foregoing provisions, we have been informed that in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy as expressed in the Securities Act and is therefore
unenforceable.
PART
II — INFORMATION NOT REQUIRED IN PROSPECTUS
Item
14. Other Expenses of Issuance
and Distribution
The
following table sets forth the various expenses payable by the Registrant in
connection with the sale and distribution of the securities being registered
hereby. The Registrant is paying all of the selling security holders’ expenses
related to this offering, except that the selling security holder will pay any
applicable broker’s commissions and expenses. All amounts are estimated except
the Securities and Exchange Commission registration fee.
|
SEC
Registration fee
|
|
$ |
210 |
|
|
Printing
and Edgarization
|
|
|
4,000 |
|
|
Accountants’
fees and expenses
|
|
|
10,000 |
|
|
Attorneys’
fees and expenses
|
|
|
12,000 |
|
|
Miscellaneous
|
|
|
790 |
|
| |
|
|
|
|
|
Total
|
|
$ |
27,000 |
|
Item
15. Indemnification of
Directors and Officers
The
Registrant’s Certificate of Incorporation provides that the personal liability
of the directors of the Registrant shall be limited to the fullest extent
permitted by the provisions of Section 102(b)(7) of the General Corporation Law
of the State of Delaware (“DGCL”). Section 1 02(b)(7) of the DGCL generally
provides that no director shall be liable personally to the Registrant or its
security holders for monetary damages for breach of fiduciary duty as a
director, provided that the Certificate of Incorporation does not eliminate the
liability of a director for (1) any breach of the director’s duty of loyalty to
the Registrant or its security holders; (2) acts or omissions not in good faith
or that involve intentional misconduct or a knowing violation of law; (3) acts
or omissions in respect of certain unlawful dividend payments or stock
redemptions or repurchases; or (4) any transaction from which such director
derives an improper personal benefit. The effect of this provision is to
eliminate the rights of the Registrant and its security holders to recover
monetary damages against a director for breach of her or his fiduciary duty of
care as a director (including breaches resulting from negligent or grossly
negligent behavior) except in the situations described in clauses (1) through
(4) above. The limitations summarized above, however, do not affect the ability
of the Registrant or its security holders to seek nonmonetary remedies, such as
an injunction or rescission, against a director for breach of her or his
fiduciary duty.
In
addition, the Certificate of Incorporation provides that the Registrant shall,
to the fullest extent permitted by Section 145 of the DGCL, indemnify all
persons whom it may indemnify pursuant to Section 145 of the DGCL. In general,
Section 145 of the DGCL permits the Registrant to indemnify a director, officer,
employee or agent of the Registrant or, when so serving at the Registrant’s
request, another company who was or is a party or is threatened to be made a
party to any proceeding because of his or her position, if he or she acted in
good faith and in a manner reasonably believed to be in or not opposed to the
best interests of the Registrant and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his or her conduct was
unlawful.
The
Registrant maintains a directors’ and officers’ liability insurance policy
covering certain liabilities that may be incurred by any director or officer in
connection with the performance of his or her duties and certain liabilities
that may be incurred by the Registrant, including the indemnification payable to
any director or officer. This policy provides for $60.0 million in maximum
aggregate coverage, including defense costs. The entire premium for such
insurance is paid by the Registrant.
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may
be permitted to directors, officers, or persons controlling the Registrant
pursuant to the foregoing provisions, the Registrant has been informed that in
the opinion of the Securities and Exchange Commission, such indemnification is
against public policy as expressed in the Securities Act and is therefore
unenforceable.
Item
16. Exhibits
|
Exhibit
Number
|
|
Description
|
|
|
|
|
|
3.1
|
|
Amended
and Restated Certificate of Incorporation of the Company
(1)
|
|
3.2.1
|
|
By-Laws
of the Company (2)
|
|
3.2.2
|
|
Amendment
to By-Laws of the Company (3)
|
|
4.1
|
|
Form
of certificate evidencing shares of common stock (4)
|
|
4.2
|
|
Indenture,
dated November 10, 2009, by and between the Registrant and Wells Fargo
Bank, N.A. (5)
|
|
4.3
|
|
Form
of 4.50% Senior Convertible Note (5)
|
|
5.1 *
|
|
Opinion
of Feder Kaszovitz LLP |
|
23.1
*
|
|
Consent
of BDO USA, LLP (formerly known as BDO Seidman, LLP) |
|
23.2
|
|
Consent
of Feder Kaszovitz LLP (included in Exhibit
5.1) |
(*) Filed
herewith.
|
(1)
|
Filed
previously as Appendix 2 to the Company’s Schedule 14A Proxy Statement
filed August 23, 2002 and incorporated herein by
reference.
|
|
(2)
|
Filed
previously as an exhibit to the Company’s Registration Statement on Form
SB-2 (Reg. No. 333-2048-LA), effective May 1, 1996, and incorporated
herein by reference.
|
|
(3)
|
Filed
previously as an exhibit to the Company’s Registration Statement on Form
SB-2 (Reg. No. 333-22583), effective May 1, 1997, and incorporated herein
by reference.
|
|
(4)
|
Filed
on May 1, 1996 as an exhibit to the Company’s Registration Statement on
Form SB-2 (Reg. No. 333-2048-LA), and incorporated herein by
reference.
|
|
(5)
|
Filed
previously as an exhibit to the Company’s Current Report on Form 8-K,
filed on November 10, 2009, and incorporated herein by
reference.
|
Item
17. Undertakings
(a) The
undersigned registrant hereby undertakes:
(1) To
file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) to
include any prospectus required by Section 10(a)(3) of the Securities Act of
1933,
(ii) to
reflect in the prospectus any facts or events arising after the effective date
of the registration statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement. Notwithstanding the
foregoing, any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20% change in the maximum aggregate offering
price set forth in the “Calculation of Registration Fee” table in the effective
registration statement, and
(iii) to
include any material information with respect to the plan of distribution not
previously disclosed in the registration statement or any material change to
such information in the registration statement;
Provided,
however, that
paragraphs
(a)(1)(i), (a)(1)(ii) and a(1)(iii)above do not apply if the registration
statement is on Form S-3 or Form F-3, and the information required to be
included in a post-effective amendment by those paragraphs, is contained in
periodic reports filed with or furnished to the Commission by the registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration statement, or is
contained in a form of prospectus filed pursuant to Rule 424(b) that is part of
the registration statement.
(2)
That, for the purpose of determining any liability under the Securities Act of
1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To
remove from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the
offering.
The
undersigned registrant hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the registrant’s
annual report pursuant to Section 13(a) or Section 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide
offering thereof.
The
undersigned registrant hereby undertakes to deliver or cause to be delivered
with the prospectus, to each person to whom the prospectus is sent or given, the
latest annual report, to security holders that is incorporated by reference in
the prospectus and furnished pursuant to and meeting the requirements of Rule
14a-3 or Rule 14c-3 under the Securities Exchange Act of 1934; and, where
interim financial information required to be presented by Article 3 of
Regulation S-X is not set forth in the prospectus, to deliver, or cause to be
delivered to each person to whom the prospectus is sent or given, the latest
quarterly report that is specifically incorporated by reference in the
prospectus to provide such interim financial information.
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may
be permitted to directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, the Registrant certifies that
it has reasonable grounds to believe that it meets all of the requirements for
filing on Form S-3 and has duly caused this Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Malibu, State of California, on February 17, 2011
|
JAKKS
PACIFIC, INC.
|
| |
|
By:
/s/ STEPHEN G. BERMAN
|
|
Stephen
G. Berman
|
|
Chief
Executive Officer
|
Pursuant
to the requirements of the Securities Act of 1933, this Registration Statement
has been signed below by the following persons in the capacities and on the
dates indicated:
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
|
|
/s/
STEPHEN G. BERMAN
|
|
Chief
Executive Officer, Director
|
|
February
17, 2011
|
|
Stephen
G. Berman
|
|
(Principal
Executive Officer)
|
|
|
|
|
|
|
|
|
|
/s/
JOEL M. BENNETT
|
|
Chief
Financial Officer (Principal Financial
|
|
February
17, 2011
|
|
Joel
M. Bennett
|
|
and
Accounting Officer)
|
|
|
|
|
|
|
|
|
|
/s/ DAN ALMAGOR
|
|
Director
|
|
February
17, 2011
|
|
Dan
Almagor
|
|
|
|
|
| |
|
|
|
|
|
/s/ MICHAEL G. MILLER
|
|
Director
|
|
February
17, 2011
|
|
Michael
G. Miller
|
|
|
|
|
| |
|
|
|
|
|
/s/ MARVIN W. ELLIN
|
|
Director
|
|
February
17, 2011
|
|
Marvin
W. Ellin
|
|
|
|
|
| |
|
|
|
|
|
/s/ ROBERT E. GLICK
|
|
Director
|
|
February
17, 2011
|
|
Robert
E. Glick
|
|
|
|
|
| |
|
|
|
|
|
MURRAY L. SKALA
|
|
Director
|
|
February
17, 2011
|
|
Murray
L. Skala
|
|
|
|
|
EXHIBIT
INDEX
|
Exhibit
Number
|
|
Description
|
|
|
|
|
|
3.1
|
|
Amended
and Restated Certificate of Incorporation of the Company
(1)
|
|
3.2.1
|
|
By-Laws
of the Company (2)
|
|
3.2.2
|
|
Amendment
to By-Laws of the Company (3)
|
|
4.1
|
|
Form
of certificate evidencing shares of common stock (4)
|
|
4.2
|
|
Indenture,
dated November 10, 2009, by and between the Registrant and Wells Fargo
Bank, N.A. (5)
|
|
4.3
|
|
Form
of 4.50% Senior Convertible Note (5)
|
|
5.1
*
|
|
Opinion
of Feder Kaszovitz LLP
|
|
23.1
*
|
|
Consent
of BDO USA, LLP (formerly known as BDO Seidman, LLP)
|
|
23.2
|
|
Consent
of Feder Kaszovitz LLP (included in Exhibit
5.1)
|
(*) Filed
herewith.
|
(1)
|
Filed
previously as Appendix 2 to the Company’s Schedule 14A Proxy Statement
filed August 23, 2002 and incorporated herein by
reference.
|
|
(2)
|
Filed
previously as an exhibit to the Company’s Registration Statement on Form
SB-2 (Reg. No. 333-2048-LA), effective May 1, 1996, and incorporated
herein by reference.
|
|
(3)
|
Filed
previously as an exhibit to the Company’s Registration Statement on Form
SB-2 (Reg. No. 333-22583), effective May 1, 1997, and incorporated herein
by reference.
|
|
(4)
|
Filed
on May 1, 1996 as an exhibit to the Company’s Registration Statement on
Form SB-2 (Reg. No. 333-2048-LA), and incorporated herein by
reference.
|
|
(5)
|
Filed
previously as an exhibit to the Company’s Current Report on Form 8-K,
filed on November 10, 2009, and incorporated herein by
reference.
|