PROSPECTUS
GRAND TOYS INTERNATIONAL, INC.
183,486 Shares of Common Stock,
Par Value $ 0.001 Per Share
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
THE SECURITIES OFFERED HEREBY INVOLVE RISK. SEE "RISK FACTORS" ON PAGE 5.
--------------------------
This Prospectus relates to the offering by the Selling Stockholders
named herein (the "Selling Stockholders") of up to an aggregate of 183,486
shares of Common Stock, par value $0.001 per share, of Grand Toys International,
Inc. (the "Company") covered by this Prospectus, which may be offered and sold
from time to time by the Selling Stockholders. The Company will not receive any
proceeds from the sale of the shares by the Selling Stockholders. The shares
offered hereby were acquired by the Selling Stockholders in connection with the
settlement of a legal proceeding involving the Company. See "Plan of
Distribution."
The Common Stock is quoted on the Nasdaq SmallCap Stock Market
("NASDAQ") under the symbol "GRIN." On January 9, 1997 the last sales price
of the Common Stock, as reported on NASDAQ, was $1.1875.
The Selling Stockholders may from time to time sell the shares of the
Common Stock offered hereby pursuant to this Prospectus. The shares of stock
offered hereby may be sold by the Selling Stockholders in ordinary brokerage
transactions, in transactions in which brokers solicit purchases, in negotiated
transactions or in a combination of such methods of sale, at market prices
prevailing at the time of sale, at prices relating to such prevailing market
prices or at negotiated prices. See "Plan of Distribution." The Common Stock
offered hereby is not subject to any underwriting agreement. Each Selling
Shareholder and any brokers or dealers through or to whom the shares of Common
Stock offered hereby may be sold may be deemed "underwriters" within the meaning
of the Securities Act of 1933, as amended (the "Securities Act"), in which event
all brokerage commissions or discounts and other compensation received by such
brokers or dealers may be deemed underwriting compensation. All expenses of
registration incurred in connection with this offering are being borne by the
Company, but all selling and other expenses which may be incurred by the Selling
Stockholders will be borne by such Selling Stockholders. None of the securities
offered pursuant to this Prospectus have been registered prior to the filing of
the Registration Statement of which this Prospectus is a part.
This Prospectus also relates to such additional securities as may be
issued to the Selling Stockholders because of future stock dividends, stock
distributions, stock splits or similar capital readjustments.
-----------
The date of this Prospectus is January 13, 1996.
<PAGE>
This Prospectus incorporates documents by reference which are not
presented herein or delivered herewith. These documents are available upon
request from Grand Toys International, Inc., 1710 Route Transcanadienne, Dorval,
Quebec, Canada H9P 1H7, Attention Ron Goldenberg, Executive Vice President and
Chief Financial Officer (Telephone: (514) 685-2180). In order to ensure timely
delivery of the documents, potential investors should allow five to eight
business days for delivery. See "Incorporation of Certain Information by
Reference."
AVAILABLE INFORMATION
No person has been authorized to give any information or to make any
representations in connection with this offering other than those contained in
this Prospectus. If given or made, such representations must not be relied upon
as having been authorized by the Company or any Selling Shareholder. This
Prospectus shall not constitute an offer to sell or the solicitation of an offer
to buy nor shall there be any sale of these securities in any state in which
such offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities law of any such state.
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Reports, proxy
statements and other information filed by the Company with the Commission,
including the reports and other information incorporated by reference into this
Prospectus, can be inspected and copied at the public reference facilities
maintained by the Commission at Room 1024, Judiciary Square, 450 Fifth Street,
N.W., Washington, D.C. 20549 and at the Commission's regional offices located at
the Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661 and at 7 World Trade Center, 13th Floor, New York, New York 10048. Copies
of such materials can be obtained from the public reference section of the
Commission, 450 Fifth Street, N.W. Washington, D.C. 20549 at prescribed rates or
from the Commission's Internet web site at http:\\www.sec.gov.
The Company has filed with the Commission a Registration Statement on
Form S-3 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act with respect to the
securities offered hereby. This Prospectus does not contain all of the
information set forth in the Registration Statement, certain parts of which were
omitted in accordance with the rules and regulations of the Commission. For
further information, reference is hereby made to the Registration Statement. Any
statements contained herein concerning the provisions of any document filed as
an exhibit to the Registration Statement or otherwise filed with the Commission
are not necessarily complete, and in each instance reference is made to the copy
of such document so filed. Each such statement is qualified in its entirety by
such reference.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference:
(i) Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1995;
(ii) Current Report on Form 8-K filed January 24, 1996;
(iii) Quarterly Reports on Form 10-QSB for the quarters ended
September 30, 1996, June 30, 1996, and March 31, 1996; and
(iv) The description of the Company's capital stock contained in
the Company's registration statement filed under Section 12 of
the Exchange Act, including any amendment or report filed for
the purpose of updating such description filed with the
Commission pursuant to Section 13 of the Exchange Act.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14
or 15(d) of the Exchange Act subsequent to the date of this Prospectus and prior
to the termination of the offering of the securities offered hereby shall be
deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company will provide without charge to each person to whom a copy
of this Prospectus is delivered, upon the written or oral request of such
person, a copy of any or all documents which are incorporated by reference
herein, other than exhibits to such documents (unless such exhibits are
specifically incorporated by reference into such documents). Requests should be
directed to Ron Goldenberg, Executive Vice President and Chief Financial
Officer, at the Company's principal executive offices.
<PAGE>
THE COMPANY
Grand Toys International, Inc. (the "Company"), through its Canadian
operating subsidiary, Grand Toys Ltd. ("Grand Canada"), has been engaged in the
toy business in Canada for over 35 years and currently distributes a wide
variety of toys throughout Canada. Grand Canada's toy business consists of two
areas of operation: (i) the importation and distribution throughout Canada, on
an exclusive basis, of a wide variety of well-known toy products designed and
manufactured throughout the world; and (ii) the sale of toy products featuring
popular characters licensed to the Company. Through a United States subsidiary,
Grand Group Inc. ("Grand US"), the Company had commenced sales of a proprietary
line of toy products in the United States and abroad in the first quarter of
1994. Due to continued operating losses and a lack of sufficient capital, Grand
US ceased operations in September 1995. On January 4, 1996 an order for relief
under Chapter 7 of the United States Bankruptcy Code was entered against Grand
US. A trustee was appointed at that time to supervise the liquidation of Grand
US's remaining assets.
On October 24, 1996, the Company announced that it had entered into a
distribution agreement with Pyramid Handbags Inc. ("Pyramid"). Under the terms
of the agreement, Grand Canada will distribute Pyramid's product line, which
includes backpacks, handbags, duffels, belt bags, small leather goods, umbrellas
and rainwear throughout Canada on an exclusive basis. The Company has
established a new subsidiary, Grand Concepts, Inc. ("Grand Concepts"), to market
this new product line, and similar products. Grand Concepts also secured the
rights to use the Star Wars(R) license on the new product line.
Grand Canada is the wholly-owned subsidiary of Grand Toys (U.S.) Ltd.,
which itself is a subsidiary of the Company. Grand Canada imports for
distribution in Canada select toys from toy manufacturers who design, develop
and manufacture such toys. These toys are generally the same products that such
manufacturers market and sell in other countries. In determining which toys to
import, Grand Canada examines such factors as consumer acceptance of the
particular toys in other countries, Canadian consumer tastes based on similar
toys distributed previously in Canada and the potential demand for such toys by
Grand Canada's customers, which is partly determined in advance by exhibiting
products to its customers prior to ordering the product from the toy
manufacturer.
Grand Canada's product line includes products featuring well-known
character properties created by others. In order to obtain the right to
manufacture and sell toy products featuring such character properties, Grand
Canada enters into license agreements with the owners of such properties. Under
the terms of the character property license agreements, Grand Canada pays
royalties to licensers that generally range from 5% to 12% of sales of the toys
utilizing such character properties. Generally, Grand Canada's character
property license agreements provide it with the exclusive right to sell only
specific products featuring the particular character property and limit the
territory in which such products may be sold in Canada. Typically, each such
license agreement extends for one to three years and may be renewed upon payment
of certain minimum guarantees or the attainment of specified sales levels during
the term of the license.
Grand Canada has written license and distribution arrangements with two
of the approximately fifteen toy manufacturers from whom it imports toys for
distribution in Canada. Grand Canada selects products from a master product list
provided to it by the manufacturer. The purchase price, depending on the
arrangement with the supplier, consists of a fixed payment for each toy, a
royalty fee based on gross sales of the products by Grand Canada in Canada or a
combination of the two. Pursuant to these agreements, Grand Canada obtains the
exclusive right to import and distribute throughout Canada the toy products
selected by it. Where agreements have been entered into, they generally extend
for one to five years and are generally exclusive for a specified product or
product line. Generally, under such agreements and arrangements, Grand Canada is
responsible for arranging and paying for shipping and other related costs and
expenses. Delivery of products generally takes approximately one to five weeks.
<PAGE>
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
shares of Common Stock offered hereby. All of the proceeds from the sale of the
shares of the Company's Common Stock offered hereby will be received by the
Selling Stockholders. The Company will pay all of the expenses of the offering.
RISK FACTORS
THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK.
PROSPECTIVE INVESTORS SHOULD CAREFULLY CONSIDER, AMONG OTHER THINGS, THE
FOLLOWING FACTORS CONCERNING THE BUSINESS OF THE COMPANY AND THIS OFFERING.
In addition to reviewing the Company's Annual Report on Form 10-KSB for
the fiscal year ended December 31, 1995, the following factors should be
considered carefully in evaluating the Company and its business before
purchasing the Common Stock offered hereby.
History of Losses. Although for the nine months ended September 30,
1996, the Company had net income of $835,019, the Company incurred losses before
taxes and extraordinary items for the years ended December 31, 1995, 1994, 1993
and 1992 of $2,971,804, $4,395,927, $278,611 and $17,936, respectively. There
can be no assurance that the Company will be profitable in the future.
Possible Conflicts of Interest. Certain relationships among the
Company, its management and affiliates create various potential and actual
conflicts of interest. Although it is the Company's policy that all material
affiliated transactions and loans will be made or entered into on terms that are
no less favorable to the Company than those that can be obtained from
unaffiliated third parties and that such transactions must be approved by a
majority of the directors who do not have an interest in the transaction,
certain situations may arise in the future where such persons would be required
to determine whether actions that could benefit or negatively impact the
Company, could negatively impart or benefit the personal interests of that
person.
Dependence on Existing Management. The success of the Company is
dependent on the expertise, experience and continued services of Stephen Altro,
a director and the President of the Company, David Mars, a director and the Vice
Chairman of the Company and Ron Goldenberg, a director and the Executive Vice
President and Chief Financial Officer of the Company. Most decisions concerning
the conduct of the Company's business are made or significantly influenced by
such persons. The loss or interruption of the services of such persons could
have a material adverse effect on the Company. The Company does not maintain
"key man" insurance on the life of any such persons. The Company has entered
into employment agreements, expiring on October 31, 1998, with each of Messrs.
Altro, Mars and Goldenberg, which employment agreements include, among other
things, provisions restricting such persons from competing with the Company
during the term of their employment and for a period of two years thereafter if
their employment with the Company is terminated for cause or voluntarily by such
persons. In the event of the loss of any such persons, no assurances can be
given that the Company will be able to obtain the services of adequate
replacement personnel.
Control by Certain Existing Shareholders. Messrs. Alto, Mars and
Goldenberg, directors and executive officers of the Company, together with an
executive officer of Grand Canada (together with members of their immediate
families) beneficially own approximately 42.64% of the Company's currently
issued and outstanding stock. In addition, the foregoing persons beneficially
own options to purchase an aggregate of 3,402,554 shares of Common Stock, which
options, if exercised in full, together with the shares of Common Stock
currently beneficially owned, would represent approximately 60.21% of the
Company's issued and outstanding capital stock. Further, of these, options to
purchase 2,127,554 shares are intended to represent an aggregate of 24.16% of
the issued and outstanding capital stock on a fully diluted basis and are
therefore subject to increase or decrease based upon changes in the number of
shares of the Company's Common Stock from time to time outstanding. These
adjustment provisions would have the effect of protecting these shareholders, in
part, from dilution as a result of the subsequent issuances of stock by the
Company.
<PAGE>
By virtue of the number of shares of Common Stock and options to
purchase Common Stock owned by Messrs. Altro, Mars and Goldenberg, such persons
will have the ability to determine the election of all the Company's directors
and control most corporate actions. Messrs. Mars, Altro and Goldenberg could
therefore vote against certain corporate activities that could benefit the other
shareholders of the Company, or in favor of certain actions that could benefit
them but not be in the best interests of the Company's other shareholders, such
as any merger or acquisition or other takeover proposition offers the Company
could in the future receive from third parties.
Shares Eligible for Future Sale; Outstanding Options and Warrants.
There are currently 7,704,500 shares of Common Stock of the Company outstanding
and options and warrants to acquire an additional 6,687,554 shares of Common
Stock are also outstanding. The voting power of each holder of Common stock
would be diluted by the issuance of these additional shares of Common Stock are
also outstanding. Moreover, the prevailing market price for the Common Stock may
be materially and adversely affected by the addition of a substantial number of
shares of Common Stock, including the shares offered hereby, into the market or
by the registration under the Securities Act for the sale of the shares
underlying such options and warrants.
Risks of Acquisitions. The Company may at times become involved in
discussions with potential acquisition candidates. However, there can be no
assurances that the Company will identify and/or consummate any acquisitions, or
that such acquisitions, if completed, will be successful. In addition, should
the Company consummate an acquisition, such acquisition could have an adverse
effect on the Company's liquidity and earnings.
New Products. As a result of changing consumer preferences, many
products in the toy industry are successfully marketed for only one or two
years. In the event a new product does not receive sufficient market acceptance,
the Company may be required to sell inventory, if any exists, of such products
at a substantial discount. Accordingly, the success of the Company is dependent
in large part on its ability to secure the rights to distribute new products and
to secure new character and well-known brand name licenses for existing or new
product lines. There can be no assurance, however, that any new products will be
successful or meet with the same success as the Company's existing products.
Government Regulation. The Company is subject to the provisions of
various laws, certain of which have been enacted by the Federal Government of
Canada and others which have been enacted by the government of the Province of
Quebec and other Canadian provinces. The laws of Canada, to which the Company is
subject, include the Hazardous Products Act which empowers the government to
protect children from hazardous toys and other articles. Under that legislation
the government has the authority to exclude from the market those articles which
are found to be hazardous. The Company is also subject to the Consumer Packaging
and Labeling Act enacted by the government of Canada, which legislation
prohibits the importing into Canada of prepackaged items and which prohibits the
sale or import or advertising in Canada of items which have misleading
information on their label.
Competition. Competition in the toy industry is intense. Many other
companies involved in such businesses in Canada and the United States have
greater financial resources than the Company, and larger sales forces, greater
name recognition, larger facilities for product development and products that
may be more competitively priced than the Company's products.
Maintenance Criteria for NASDAQ Securities; Disclosure Relating to
Low-Priced Stocks. In order to continue to be included on NASDAQ, a company
currently must maintain $2 million in total assets, a $200,000 market value of
the public float and $1 million in total capital and surplus. In addition,
continued inclusion requires two market-makers, at least 300 holders of the
Common Stock and a minimum bid price of $1 per share; provided, however, that if
a company falls below such minimum bid price, it will remain eligible for
continued inclusion in NASDAQ if the market value of the public float is at
least $1 million and the Company has $2 million in capital and surplus.
On November 6, 1996, the Board of Directors of the National Association
of Securities Dealers, Inc., approved proposed changes to the maintenance
standards for securities listed on NASDAQ. The changes would (i) increase the
required market value of public float from $200,000 to $1,000,000; (ii) require
maintenance of $2 million in Net Tangible Assets (defined to mean total assets
less total liabilities and goodwill) or net income of $500,000 in two of the
last three years or a market capitalization of $35 million. In addition, the
changes would impose corporate governance standards consisting of (i) a minimum
of two independent directors; (ii) an audit committee, a majority of the members
of which are independent directors; (iii) an annual shareholder meeting; and
(iv) shareholder approval for certain corporate actions. These proposed changes
will become effective if, after the expiration of the thirty-day comment period,
they are approved by the Commission.
The failure to meet these maintenance criteria in the future may result
in the discontinuance of the inclusion of the Company's Common Stock on NASDAQ.
In such event, trading, if any, in the Company's Common Stock may then continue
to be conducted on the electronic bulletin board operated by the National
Association of Securities Dealers, Inc. or on the "pink sheets." As a result, an
investor may find it more difficult to dispose of, or to obtain accurate
quotations as to the market value of, the shares of the Company's Common Stock.
In addition, the Company would be subject to a rule promulgated by the
Commission that, if the Company fails to meet certain criteria set forth in such
rule, imposes various sales practice requirements on broker-dealers who sell
securities governed by the rule to persons other than established customers and
accredited investors. For these types of transactions, the broker-dealer must
make a special suitability determination for the purchaser and have received the
purchaser's written consent to the transactions prior to sale. Consequently, the
rule may have an adverse effect on the ability of broker-dealers to sell the
Company's Common Stock, which may affect the ability of purchasers of the Shares
offered hereby to sell the Company's Common Stock in the secondary market.
The Commission has also adopted rules that define a "penny stock."
Although the Common Stock is currently outside the definitional scope of a penny
stock under the new rules, in the event the Company's Common Stock were
subsequently characterized as a penny stock, broker-dealers dealing in the
Company's Common Stock will be subject to the disclosure rules for transactions
involving penny stocks. The additional burdens imposed upon broker-dealers may
discourage broker-dealers from effecting transactions in penny stocks which
could reduce the liquidity of the Company's Common Stock. These new rules could
then have a material adverse effect on the trading market for the Company's
Common Stock.
No Dividends. The Company has not paid any cash or other dividends on
its Common Stock and does not expect to declare or pay any cash dividends in the
foreseeable future. In addition, the Company's current credit agreement with its
bank restricts the payment of any dividends without the bank's prior consent.
FORWARD LOOKING STATEMENTS
To the extent identified therein, certain of the documents incorporated
herein by reference contain statements that are forward looking statements that
involve risks and uncertainties. Accordingly, as described therein, no
assurances can be given that the actual events and results will not be
materially different from the anticipated events and results described in the
forward looking statements.
<PAGE>
SELLING STOCKHOLDERS
The following table sets forth information regarding the beneficial
ownership of the Company's Common Stock by the Selling Stockholders identified
below prior to this offering, the maximum number of shares of Common Stock to be
sold in this offering by each of the Selling Stockholders pursuant to this
Prospectus and the beneficial ownership of the Company's Common Stock by the
Selling Stockholders after this offering, assuming that all shares of Common
Stock offered hereby are sold.
Maximum Number
Shares Beneficially of Shares To Be Shares Beneficially
Owned Prior to Offering Sold In This Owned After
Offering Offering(1)
Name of Beneficial Number Percent Number Percent
Owner
- -----------------------------------------------------------------------------
Roger W. Lehmann 50,958 * 50,958 -0- *
c/o Edison Corporate
Center
3100 Woodbridge Ave.
Suite 102
Edison, NJ 08837
Michael I. Satten 50,958 * 50,958 -0- *
26 Cow Lane
Kings Point, NY 11024
Stephanie Janis, Inc. 50,958 * 50,958 -0- *
64 West 15th Street
Suite 3E
New York, NY 10011
Robert S. Stoll 30,612 * 30,612 -0- *
Stoll, Miskin, Prevido
& Hoffman
350 Fifth Avenue
6110 The Empire State
Building
New York, NY 10118
- --------
* Less than 1%
(1)......Assumes the sale of all shares of Common Stock registered hereunder,
although none of the Selling Stockholders are under any obligation known to the
Company to sell any shares.
The Selling Stockholders acquired the Common Stock offered hereby
pursuant to a Settlement Agreement resulting from the lawsuit entitled Roger W.
Lehmann and Michael I. Satten v. Stephen Altro, David Mars, Lawrence Bernstein,
Grand Toys International, Inc. and Grand Toys Ltd. Messrs. Lehmann and Statten
are two inventors who had royalty agreements with Grand US. One of the
agreements had been personally guaranteed by Messrs. Mars, Altro and Bernstein,
the former president of the Company and Grand US, and the Company. Plaintiffs
had sued based upon, among other things, for breach of contract and claimed
damages between $1 million and $5 million. In addition to the subject shares of
Common Stock, the Selling Stockholders received a cash payment pursuant to the
settlement.
None of the Selling Stockholders nor any of their respective affiliates
is an officer, director, employee or affiliate of the Company.
<PAGE>
The Company will pay the expenses of registering the shares of Common
Stock being sold hereunder which are estimated to be $5,351.97.
PLAN OF DISTRIBUTION
The Company's Common Stock is quoted on NASDAQ under the symbol "GRIN."
The Selling Stockholders may from time to time sell all or a portion of the
shares of Common Stock offered hereby in transactions on NASDAQ, in the
over-the-counter market, in privately-negotiated transactions or a combination
of such methods of sale, in each case at market prices prevailing at the time of
sale, at prices related to such prevailing market prices or at negotiated
prices. The shares of Common Stock offered hereby may be sold directly or
through broker-dealers. If shares of Common Stock are sold through
broker-dealers, the Selling Shareholders may pay brokerage commissions and
charges. The methods by which the shares of Common Stock offered hereby may be
sold include (a) a block trade (which may involve crosses) in which the broker
or dealer so engaged will attempt to sell the securities as agent but may
position and resell a portion of the block as principal to facilitate the
transaction; (b) purchases by a broker or dealer as principal and resale by such
broker or dealer for its own account pursuant to this Prospectus; (c) exchange
distributions and/or secondary distributions in accordance with the rules of The
NASDAQ Stock Market; (d) ordinary brokerage transactions and transactions in
which the broker solicits purchasers; and (e) privately negotiated transactions.
The Common Stock offered hereby will be sold by the Selling
Stockholders acting as principal for their own account, and the Company will
receive no proceeds from this offering. The Selling Stockholders will pay all
applicable stock transfer taxes, transfer fees and brokerage commissions or
discounts. The Company has agreed to bear the cost of preparing the Registration
Statement of which this Prospectus is a part and all filing fees and legal and
accounting expenses in connection with registration of the shares of Common
Stock offered hereby under federal and state securities laws.
The Selling Stockholders and any broker-dealers through or to whom the
shares of Common Stock offered hereby may be sold may be deemed "underwriters"
within the meaning of the Securities Act, in which event, all brokerage
commissions or discounts and other compensation received by such broker-dealer
may be deemed to be underwriting discounts or commissions under the Securities
Act. The Selling Stockholders may indemnify any broker-dealer that participates
in transactions involving the sale of shares of Common Stock against certain
liabilities, including liabilities under the Securities Act.
There can be no assurance that the Selling Stockholders will sell any
or all of the shares of Common Stock offered hereby.
LEGAL MATTERS
The legality of the shares offered hereby has been passed upon for the
Company by Piper & Marbury L.L.P., 1251 Avenue of the Americas, New York, New
York 10020-1104.
EXPERTS
The consolidated financial statements of the Company incorporated by
reference in this Prospectus and Registration Statement, have been audited by
KPMG, independent auditors, to the extent indicated in their reports thereon
also incorporated by reference. Such consolidated financial statements have been
incorporated herein by reference in reliance upon such reports given upon the
authority of such firm as experts in accounting and auditing.
<PAGE>
============================== ========================================
No person has been authorized
by the Company 183,486 Shares
to give any information or to
make any representations other
than those contained in this 183,486 Shares
this Prospectus in connection
with the offer contained in
this Prospectus, and if given
or made, such information or
representations may not be
relied upon as having been
authorized by the Company.
This Prospectus does not
constitute an offer to sell or
a solicitation of an offer to GRAND TOYS
buy any of the securities in INTERNATIONAL, INC.
any jurisdiction in which such
offer or solicitation is not Common Stock
authorized, or in which the
person making such offer or
solicitation is not qualified
to do so, or to any person to
whom it is unlawful to make
such offer or solicitation.
Neither the delivery of this
Prospectus nor any sale made PROSPECTUS
hereunder shall create an
implication that there has been
no change in the affairs of the
Company since the date hereof.
January 13, 1997
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TABLE OF CONTENTS
Page
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Available Information.........2
Incorporation of Certain
Documents by Reference.....2
The Company...................4
Use of Proceeds...............5
Risk Factors..................5
Forward Looking Statements....7
Selling Stockholders..........8
Plan of Distribution..........9
Legal Matters.................9
Experts.......................9
