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JAKKS Pacific, Inc. (NASDAQ: JAKK) today announced the pricing of $100 million principal amount of 4.25% convertible senior notes due 2018 (the “notes”).
The notes are senior unsecured obligations of JAKKS, will pay interest semi-annually at a rate of 4.25% per annum and will mature on August 1, 2018. The conversion rate will initially be 114.3674 shares of JAKKS common stock per $1,000 principal amount of notes (equivalent to an initial conversion price of approximately $8.74 per share of common stock), subject to adjustment in certain circumstances. The notes will be convertible at the option of the holder, and upon conversion, the notes will be settled in shares of JAKKS’ common stock, except that cash will be paid in lieu of any fractional shares. Holders of the notes may require JAKKS to repurchase for cash all or some of their notes upon the occurrence of a fundamental change (as defined). JAKKS anticipates closing the offering of the notes on July 24, 2013. JAKKS also granted the initial purchaser of the notes a 30-day option to purchase up to an additional $15.0 million in principal amount of additional notes to cover over-allotments, if any.
JAKKS intends to use a portion of the net proceeds from this offering to repurchase a portion of its 4.50% convertible senior notes due 2014. In the event JAKKS is unable to repurchase such notes on satisfactory terms, JAKKS may use such proceeds for general corporate purposes.
The notes will be offered to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). The notes will not be registered under the Securities Act or any other jurisdiction and, unless so registered, may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act and applicable state laws.