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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=5><B>UNITED STATES <BR>


SECURITIES AND EXCHANGE COMMISSION </B></FONT><BR>

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<FONT FACE="Times New Roman, Times, Serif" SIZE=4><B>WASHINGTON, D.C. 20549</B> </FONT><BR><BR>

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<FONT FACE="Times New Roman, Times, Serif" SIZE=5><B>FORM 8-K </B></FONT></P>

<P align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=3><B>CURRENT REPORT<BR><BR> PURSUANT TO SECTION 13
OR 15 (d) OF THE <BR>SECURITIES EXCHANGE ACT OF 1934</B></FONT></p>


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<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE=3>Date
of Report (Date of earliest event reported): <B>June 30, 2005</B> </FONT></P>

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<p><table width=600><tr><td  align=center><font size=2><B>Commission file number 0-7843</B></font></td></tr></table>


<p><table width=600><tr>
    <td  align=center><font size=2><B><font size="6">4Kids Entertainment, Inc.
      </font></B></font>
      <hr noshade align="center" size="1" width="50%">
      <font size=2> (Exact name of Registrant as specified in its charter)</font></td>
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    <td  align=center width="292"><font size=2><B>New York</B></font>
      <hr noshade align="center" size="1" width="50%">
      <font size=2><B> </B>(State or other jurisdiction of <br>
      incorporation or organization) </font></td>
    <td  align=center width="296"><font size=2><b>13-2691380</b></font>
      <hr noshade align="center" size="1" width="50%">
      <font size=2><b> </b>(I.R.S. Employer<br>
      Identification No.)</font></td>
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    <td  align=center><font size=2><B>1414 Avenue of the Americas <BR>
      New York, New York 10019 <BR>
      (212) 758-7666 </B></font>
      <hr noshade align="center" size="1" width="50%">
      <font size=2><B> (</B>Address, including zip code, and telephone number,
      including area code,<br>
      of Registrant&#146;s principal executive offices)</font></td>
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<P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT FACE="Times New Roman" SIZE="2">Check the
appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px">
<FONT SIZE="1">&nbsp;</FONT></P>


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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT FACE="Times New Roman" SIZE="2"></FONT><FONT FACE="WINGDINGS" SIZE="2" COLOR="#000000">&#168;</FONT><FONT FACE="Times New Roman" SIZE="2"></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT FACE="Times New Roman" SIZE="2">Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) </FONT></TD></TR><TR><TD>&nbsp;</TD></TR></TABLE>

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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT FACE="Times New Roman" SIZE="2"></FONT><FONT FACE="WINGDINGS" SIZE="2" COLOR="#000000">&#168;</FONT><FONT FACE="Times New Roman" SIZE="2"></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT FACE="Times New Roman" SIZE="2">Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) </FONT></TD></TR><TR><TD>&nbsp;</TD></TR></TABLE>

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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT FACE="Times New Roman" SIZE="2"></FONT><FONT FACE="WINGDINGS" SIZE="2" COLOR="#000000">&#168;</FONT><FONT FACE="Times New Roman" SIZE="2"></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT FACE="Times New Roman" SIZE="2">Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) </FONT></TD></TR><TR><TD>&nbsp;</TD></TR></TABLE>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%"> <TR>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT FACE="Times New Roman" SIZE="2"></FONT><FONT FACE="WINGDINGS" SIZE="2" COLOR="#000000">&#168;</FONT><FONT FACE="Times New Roman" SIZE="2"></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT FACE="Times New Roman" SIZE="2">Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) </FONT></TD></TR></TABLE>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 1.01. Entry into a Material
Definitive Agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>On June&nbsp;30, 2005, 4Kids
Entertainment, Inc. (&#147;4Kids&#148; or the &#147;Company&#148;) and Steven M. Grossman,
a member of 4Kids&#146; board of directors, entered into an employment agreement (the
&#147;Employment Agreement&#148;) pursuant to which Mr. Grossman will be employed as
Executive Vice President and Chief Operating Officer of 4Kids. <BR><BR>While Mr. Grossman will continue to serve
as a director of the Company, he has resigned from 4Kids' Audit, Compensation and Nominating and Corporate
Governance Committees concurrent with the execution of the Employment Agreement.</FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Pursuant to the Employment Agreement,
Mr. Grossman&#146;s employment will commence on September 1, 2005 and continue until the
third anniversary thereof. Under the
Employment Agreement, Mr. Grossman will be entitled to receive an annual base salary of
$700,000 and an annual cash bonus determined by the Compensation Committee of the board of
directors of 4Kids (the &#147;Compensation Committee&#148;) in its sole discretion;
<U>provided</U>, <U>however</U>, that with respect to the remainder of 2005, Mr. Grossman will be entitled
to receive a cash bonus in an amount equal to approximately $100,000. Mr. Grossman will be
granted stock options to purchase 125,000 shares of the Company&#146;s common stock on
September 1, 2005 with an exercise price equal to the fair market value of a share of the
Company&#146;s common stock as of such date (determined under the Company&#146;s 2004
Stock Option Plan). Fifty percent of such stock options will be vested and exercisable by
Mr. Grossman as of the date of grant and the remainder will vest and become exercisable by
Mr. Grossman on December 31, 2005. During the term of his employment, Mr. Grossman will be
entitled to participate in all employee benefit plans and programs generally made available to the
Company's senior executives and to such other benefits as are set forth in the Employment Agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>If the Company terminates Mr.
Grossman without &#147;cause&#148; (as defined in the Employment Agreement) or if
Mr.&nbsp;Grossman terminates his employment for &#147;good reason&#148; (as defined in
the Employment Agreement), Mr. Grossman will be entitled to receive (i) for a period equal
to the greater of two years and the remainder of the then current term (a) his base
salary, (b) the average of the cash bonuses paid to him in respect of the three (3) prior
full fiscal years (or such shorter periods, as applicable) (c) his annual automobile allowance, and (ii) for a period of two (2)
years, all group health benefits he was receiving as of the date of termination. In the event that the
employment agreement is not extended beyond its initial three year term, Mr.
Grossman will be entitled to receive his annual base salary and all group health benefits
he was receiving at the time of the expiration of the term for a period of one year
following the date of such expiration. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Employment Agreement also
provides that Mr. Grossman will not be entitled to engage in competition with the Company
for a period of twelve (12) months following the date of termination of Mr.
Grossman&#146;s employment with the Company as well as other customary covenants
concerning non-solicitation and non-disclosure of confidential information. </FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The definitive agreement described
above is furnished as exhibit 99.1 to this Report and incorporated by reference herein.
The preceding descriptions of this agreement is summary in nature and does not purport to
be complete. This summary should be read in connection with the exhibits hereto. </FONT></P>




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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 3.01 Notice of Delisting or
Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing. </FONT></P>

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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) Notification of
Noncompliance </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Company has notified the New York
Stock Exchange (&#147;NYSE&#148;) that Mr. Grossman is no longer considered to be an
independent director within the meaning of Section 3.03A.02 of the Rules of the NYSE as a
result of the entry into the Employment Agreement, and that the Company is not currently
in compliance with Section 3.03A.01 of the Rules of the NYSE which requires that a
majority of the Company&#146;s directors be independent. The Company has committed to
returning to compliance prior to December 31, 2005. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 5.02. Departure of Directors or
Principal Officers; Election of Directors; Appointment of Principal Officers. </FONT></P>

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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a) Departure of
Directors or Principal Officers </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>As described in Item 1.01 above, Mr.
Grossman voluntarily resigned from 4Kids&#146; Audit, Compensation and Nominating and
Corporate Governance Committees upon his execution of the Employment Agreement. Joseph P.
Garrity, the Company&#146;s current Chief Financial Officer and Chief Operating Officer,
will continue to serve as 4Kids&#146; Chief Financial Officer and will cease to be
4Kids&#146; Chief Operating Officer effective as of September 1, 2005. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c)&nbsp;&nbsp;&nbsp;&nbsp;
          Appointment of Principal Officers </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr.&nbsp;
          Steven M. Grossman has been appointed as Executive Vice President and Chief
          Operating Officer of the Company effective as of September 1, 2005. The material terms of
          Mr. Grossman&#146;s employment agreement are disclosed in Item 1.01 of this
          Report on Form 8-K. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Mr.&nbsp;
          Grossman has served as a director of the Company since June 2001.
          Mr.&nbsp;Grossman has been Executive Vice President, Chief Financial Officer and
          Treasurer of R.A.B. Holdings, Inc. since its inception in 1996. R.A.B. Holdings, Inc.
is a diversified holding company, which currently owns Millbrook Distribution Services Inc.
(&#147;Millbrook&#148;) and the R.A.B. Food Group, LLC (&#147;RAB Food&#148;). Mr.&nbsp;Grossman has been a director and Executive Vice
          President&nbsp;- Finance and Administration of Millbrook, an independent distributor of specialty foods, health and beauty care
          products and general merchandise, since 1997 and has been a member of the Board
          of Managers and Executive Vice President, Chief Financial Officer and Treasurer
          of RAB Food (formerly The B. Manischewitz Company, LLC), a
          manufacturer of processed kosher food products, since 1998. Mr.&nbsp;Grossman
          has also been Executive Vice President and Chief Financial Officer of RABCO
          Luxury Holdings LLC, a diversified holding company which distributes luxury
          products since 1998 and Chief Financial Officer of P&amp;E Properties Inc., a
          private commercial real estate ownership/ management company, since 1994.
          Mr.&nbsp;Grossman was Executive Vice President and Chief Financial Officer of
          Western Publishing Group, Inc., from June 1994 to May 1996. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>On July 7, 2005, 4Kids Entertainment,
Inc. issued a press release announcing the employment of Steven M. Grossman as Executive
Vice President and Chief Operating Officer (the &#147;Press Release&#148;). A copy of the
Press Release is attached hereto as Exhibit 99.2 and incorporated by reference herein.<BR><BR>

Item 9.01.  Financial Statements and Exhibits.</FONT></P>


<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
Exhibits</FONT></P>

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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;<U>Exhibit</U>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Description</U></FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;99.1&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Executive Employment Agreement, dated June 30, 2005, between 4Kids Entertainment,<BR>
                       &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inc. and Steven M. Grossman.</FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;99.2&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Press release announcing the employment of Steven M. Grossman as Executive Vice<BR>
                       &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; President and Chief Operating Officer.</FONT></P>





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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SIGNATURES </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned hereunto duly authorized. </FONT></P>

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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Date:&nbsp;&nbsp;July 7, 2005 </FONT></P>


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<TD WIDTH=50%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>4KIDS ENTERTAINMENT, INC.</B><BR><BR>
<BR>BY: <U><I>/s/ Joseph P. Garrity </I></U><BR><BR>
Joseph P. Garrity<BR>Executive Vice President, Chief Financial Officer</FONT></TD>
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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;<U>Exhibit</U>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Description</U></FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;99.1&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Executive Employment Agreement, dated June 30, 2005, between 4Kids Entertainment,<BR>
                       &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inc. and Steven M. Grossman.</FONT></P>

<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;99.2&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Press release announcing the employment of Steven M. Grossman as Executive Vice<BR>
                       &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; President and Chief Operating Officer.</FONT></P>



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[{"type": "8-K", "sequence": "1", "filename": "form8k6302005sg.htm", "description": "FORM 8K AND PRESS RELEASE", "secsgml_size_bytes": 21002}]
{"company-data": {"conformed-name": "4 KIDS ENTERTAINMENT INC", "cik": "0000058592", "assigned-sic": "6794", "irs-number": "132691380", "state-of-incorporation": "NY", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-16117", "film-number": "05943883"}, "business-address": {"street1": "1414 AVE OF THE AMERICAS", "city": "NEW YORK", "state": "NY", "zip": "10019", "phone": "2127587666"}, "mail-address": {"street1": "1414 AVENUE OF THE AMERICAS", "city": "NEW YORK", "state": "NY", "zip": "10019"}, "former-company": [{"former-conformed-name": "LEISURE CONCEPTS INC", "date-changed": "19920703"}, {"former-conformed-name": "AMERICAN LEISURE INDUSTRIES INC", "date-changed": "19740822"}]}
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13
OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date
of Report (Date of earliest event reported):
June 30, 2005
Commission file number 0-7843
4Kids Entertainment, Inc.
(Exact name of Registrant as specified in its charter)
New York
(State or other jurisdiction of
incorporation or organization)
13-2691380
(I.R.S. Employer
Identification No.)
1414 Avenue of the Americas
New York, New York 10019
(212) 758-7666
(
Address, including zip code, and telephone number,
      including area code,
of Registrant's principal executive offices)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01. Entry into a Material
Definitive Agreement.
On June 30, 2005, 4Kids
Entertainment, Inc. ("4Kids" or the "Company") and Steven M. Grossman,
a member of 4Kids' board of directors, entered into an employment agreement (the
"Employment Agreement") pursuant to which Mr. Grossman will be employed as
Executive Vice President and Chief Operating Officer of 4Kids.
While Mr. Grossman will continue to serve
as a director of the Company, he has resigned from 4Kids' Audit, Compensation and Nominating and Corporate
Governance Committees concurrent with the execution of the Employment Agreement.
Pursuant to the Employment Agreement,
Mr. Grossman's employment will commence on September 1, 2005 and continue until the
third anniversary thereof. Under the
Employment Agreement, Mr. Grossman will be entitled to receive an annual base salary of
$700,000 and an annual cash bonus determined by the Compensation Committee of the board of
directors of 4Kids (the "Compensation Committee") in its sole discretion;
provided
,
however
, that with respect to the remainder of 2005, Mr. Grossman will be entitled
to receive a cash bonus in an amount equal to approximately $100,000. Mr. Grossman will be
granted stock options to purchase 125,000 shares of the Company's common stock on
September 1, 2005 with an exercise price equal to the fair market value of a share of the
Company's common stock as of such date (determined under the Company's 2004
Stock Option Plan). Fifty percent of such stock options will be vested and exercisable by
Mr. Grossman as of the date of grant and the remainder will vest and become exercisable by
Mr. Grossman on December 31, 2005. During the term of his employment, Mr. Grossman will be
entitled to participate in all employee benefit plans and programs generally made available to the
Company's senior executives and to such other benefits as are set forth in the Employment Agreement.
If the Company terminates Mr.
Grossman without "cause" (as defined in the Employment Agreement) or if
Mr. Grossman terminates his employment for "good reason" (as defined in
the Employment Agreement), Mr. Grossman will be entitled to receive (i) for a period equal
to the greater of two years and the remainder of the then current term (a) his base
salary, (b) the average of the cash bonuses paid to him in respect of the three (3) prior
full fiscal years (or such shorter periods, as applicable) (c) his annual automobile allowance, and (ii) for a period of two (2)
years, all group health benefits he was receiving as of the date of termination. In the event that the
employment agreement is not extended beyond its initial three year term, Mr.
Grossman will be entitled to receive his annual base salary and all group health benefits
he was receiving at the time of the expiration of the term for a period of one year
following the date of such expiration.
The Employment Agreement also
provides that Mr. Grossman will not be entitled to engage in competition with the Company
for a period of twelve (12) months following the date of termination of Mr.
Grossman's employment with the Company as well as other customary covenants
concerning non-solicitation and non-disclosure of confidential information.
The definitive agreement described
above is furnished as exhibit 99.1 to this Report and incorporated by reference herein.
The preceding descriptions of this agreement is summary in nature and does not purport to
be complete. This summary should be read in connection with the exhibits hereto.
Item 3.01 Notice of Delisting or
Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.
(b) Notification of
Noncompliance
The Company has notified the New York
Stock Exchange ("NYSE") that Mr. Grossman is no longer considered to be an
independent director within the meaning of Section 3.03A.02 of the Rules of the NYSE as a
result of the entry into the Employment Agreement, and that the Company is not currently
in compliance with Section 3.03A.01 of the Rules of the NYSE which requires that a
majority of the Company's directors be independent. The Company has committed to
returning to compliance prior to December 31, 2005.
Item 5.02. Departure of Directors or
Principal Officers; Election of Directors; Appointment of Principal Officers.
(a) Departure of
Directors or Principal Officers
As described in Item 1.01 above, Mr.
Grossman voluntarily resigned from 4Kids' Audit, Compensation and Nominating and
Corporate Governance Committees upon his execution of the Employment Agreement. Joseph P.
Garrity, the Company's current Chief Financial Officer and Chief Operating Officer,
will continue to serve as 4Kids' Chief Financial Officer and will cease to be
4Kids' Chief Operating Officer effective as of September 1, 2005.
(c)    
          Appointment of Principal Officers
Mr. 
          Steven M. Grossman has been appointed as Executive Vice President and Chief
          Operating Officer of the Company effective as of September 1, 2005. The material terms of
          Mr. Grossman's employment agreement are disclosed in Item 1.01 of this
          Report on Form 8-K.
Mr. 
          Grossman has served as a director of the Company since June 2001.
          Mr. Grossman has been Executive Vice President, Chief Financial Officer and
          Treasurer of R.A.B. Holdings, Inc. since its inception in 1996. R.A.B. Holdings, Inc.
is a diversified holding company, which currently owns Millbrook Distribution Services Inc.
("Millbrook") and the R.A.B. Food Group, LLC ("RAB Food"). Mr. Grossman has been a director and Executive Vice
          President - Finance and Administration of Millbrook, an independent distributor of specialty foods, health and beauty care
          products and general merchandise, since 1997 and has been a member of the Board
          of Managers and Executive Vice President, Chief Financial Officer and Treasurer
          of RAB Food (formerly The B. Manischewitz Company, LLC), a
          manufacturer of processed kosher food products, since 1998. Mr. Grossman
          has also been Executive Vice President and Chief Financial Officer of RABCO
          Luxury Holdings LLC, a diversified holding company which distributes luxury
          products since 1998 and Chief Financial Officer of P&E Properties Inc., a
          private commercial real estate ownership/ management company, since 1994.
          Mr. Grossman was Executive Vice President and Chief Financial Officer of
          Western Publishing Group, Inc., from June 1994 to May 1996.
On July 7, 2005, 4Kids Entertainment,
Inc. issued a press release announcing the employment of Steven M. Grossman as Executive
Vice President and Chief Operating Officer (the "Press Release"). A copy of the
Press Release is attached hereto as Exhibit 99.2 and incorporated by reference herein.
Item 9.01.  Financial Statements and Exhibits.
(c)
Exhibits
Exhibit
Description
99.1    
                       
      Executive Employment Agreement, dated June 30, 2005, between 4Kids Entertainment,
Inc. and Steven M. Grossman.
99.2    
                       
      Press release announcing the employment of Steven M. Grossman as Executive Vice
President and Chief Operating Officer.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date:  July 7, 2005
4KIDS ENTERTAINMENT, INC.
BY:
/s/ Joseph P. Garrity
Joseph P. Garrity
Executive Vice President, Chief Financial Officer
Exhibit
Description
99.1    
                       
      Executive Employment Agreement, dated June 30, 2005, between 4Kids Entertainment,
Inc. and Steven M. Grossman.
99.2    
                       
      Press release announcing the employment of Steven M. Grossman as Executive Vice
President and Chief Operating Officer.