Jakks agrees to redeem all series A preferreds for cash, stock

By Mary-Katherine Stinson

Lexington, Ky., March 12 – Jakks Pacific Inc. agreed to redeem all its shares of series A preferred stock, according to a press release.

The negotiated redemption price is 571,295 shares of the company’s common stock, valued at $15 million, and $20 million in cash. The cash portion was funded from cash on hand.

The preferreds are the last debt-related security issued as part of the company’s 2019 restructuring.

The price represents a discount of $4.6 million to the contractual liquidation premium and will eliminate $1.6 million in preferred dividends over the next 12 months. The redemption eliminates Jakks’ preferred stock derivative liability of $29.947 million and preferred stock accrued dividends of $5.992 million as of Dec. 31.

Following the transaction, the company will have 10,798,353 outstanding common shares, a dilution of 5.6%.

Malibu, Calif.-based Jakks is a toy and leisure products company.

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