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GENIUS BRANDS INTERNATIONAL, INC.

Date Filed : Apr 15, 2019

S-11genius_s1.htmFORM S-1

 

Table of Contents

As filed with the Securities and ExchangeCommission on April 12, 2019

 

Registration Statement No. 333-                  

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM S-1

REGISTRATION STATEMENT

underthe

SECURITIES ACT OF 1933

 

GENIUS BRANDS INTERNATIONAL, INC.

(Exact name of registrant as specified inits charter)

 

Nevada

(State or other jurisdiction of

incorporation or organization)

 

20-4118216

(I.R.S. Employer

Identification No.)

 

8383 Wilshire Blvd., Suite 412
Beverly Hills, CA 90211
(310) 499-2402

(Address, including zip code, and telephonenumber, including area code,

of registrant’s principal executiveoffices)

 

AndyHeyward
Chief Executive Officer
Genius Brands International, Inc.
8383 Wilshire Blvd., Suite 412
Beverly Hills, CA 90211
(310) 499-2402

 

(Name, address, including zip code, andtelephone number, including area

code, of agent for service)

 

Copies to:

 

Kenneth R. Koch, Esq.

Jeffrey P. Schultz, Esq.

Mintz, Levin, Cohn, Ferris, Glovsky andPopeo P.C.

Chrysler Center, 666 Third Avenue

New York, NY 10017

Tel: (212) 935-3000

 

Approximate date of commencement of proposedsale to the public: From time to time after this registration statement becomes effective.

 

If any of the securities being registeredon this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check thefollowing box. [X]

 

If this Form is filed to register additionalsecurities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the SecuritiesAct registration statement number of the earlier effective registration statement for the same offering. [_]

 

If this Form is a post-effective amendmentfiled pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statementnumber of the earlier effective registration statement for the same offering. [_]

 

If this Form is a post-effective amendmentfiled pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statementnumber of the earlier effective registration statement for the same offering. [_]

 

Indicate by check mark whether the registrantis a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growthcompany. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reportingcompany” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer Accelerated filer
Non-accelerated filer Smaller reporting company
    Emerging growth company

 

If an emerging growth company, indicateby check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financialaccounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

 

CALCULATION OF REGISTRATION FEE

                 
 

Title of Each Class of

Securities to be Registered

  Amount to be
Registered (1)
  Proposed Maximum
Offering Price
per Share (2)
  Proposed Maximum
Aggregate Offering
Price
  Amount of
Registration Fee
Common Stock, par value $0.001 per share, underlying the investor warrants   945,894   $2.21   $2,090,425.74   $253.36

 

 

(1) All of the shares of common stock offered hereby are for the account of selling stockholders and consist of 945,894 shares issuable upon the exercise of warrants (the “Warrants”). Pursuant to Rule 416 of the Securities Act of 1933, as amended (the “Securities Act”), this registration statement also covers any additional shares of common stock which become issuable by reason of any share dividend, share split, recapitalization or any other similar transaction without receipt of consideration which results in an increase in the number of shares of common stock outstanding.
(2) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(g) under the Securities Act based upon the higher of (i) the price at which the warrants may be exercised, and (ii) $1.945, the average of the high and low prices for a share of the registrant’s common stock as reported on The Nasdaq Capital Market on April 9, 2019, which date is a date within five business days of the filing of this registration statement.

 

The registrant hereby amends this RegistrationStatement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendmentwhich specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) ofthe Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securitiesand Exchange Commission, acting pursuant to said Section 8(a), may determine.

 

 

   

 

 

 

The informationin this prospectus is not complete and may be changed. The selling stockholders may not sell these securities pursuant tothis prospectus until the registration statement filed with the Securities and Exchange Commission is effective. This prospectusis not an offer to sell these securities and is not soliciting offers to buy these securities in any jurisdiction where the offeror sale is not permitted.

 

SUBJECT TOCOMPLETION, DATED APRIL 12, 2019

 

PRELIMINARY PROSPECTUS

 

 

GENIUS BRANDS INTERNATIONAL, INC.

945,894 SHARES OF COMMON STOCK

 

This prospectus relates to the resale ofup to 945,894 shares of our common stock issuable upon exercise of certain outstanding warrants issued by us in a private placement.

 

These shares will be resold from time totime by the entities listed in the section titled “Selling Stockholders” beginning on page 8, which we refer to asthe selling stockholders. The shares of common stock offered under this prospectus by the selling stockholders are issuable uponexercise of warrants issued in a private placement pursuant to the Securities Purchase Agreement by and among Genius Brands International,Inc. and the selling stockholders, dated as of February 14, 2019 (the “Purchase Agreement”). We are not selling anysecurities under this prospectus and will not receive any of the proceeds from the sale of securities by the selling stockholders.

 

The selling stockholders may sell the sharesof common stock described in this prospectus in a number of different ways and at varying prices. We provide more informationabout how a selling stockholder may sell its shares of common stock in the section titled “Plan of Distribution” onpage 10. We will pay the expenses incurred in registering the securities covered by the prospectus, including legal and accountingfees.

 

Our common stock is traded on TheNasdaq Capital Market, or Nasdaq, under the symbol “GNUS”. On April 10, 2019, the last reported sale price of ourcommon stock was $1.92 per share.

_______________________

 

AN INVESTMENT IN OUR COMMON STOCK INVOLVESRISKS. SEE THE

SECTION ENTITLED “RISK FACTORS”BEGINNING ON PAGE 6.

_______________________

 

Neither the Securities and Exchange Commissionnor any state securities commission has

approved or disapproved of these securitiesor determined if this prospectus is truthful

or complete. Any representation to thecontrary is a criminal offense.

 

_______________________

 

 

The date of this prospectus is ______, 2019

 

 

 

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TABLE OF CONTENTS

 

 

Prospectus Summary 1
   
The Offering 5
   
Risk Factors 6
   
Special Note Regarding Forward-Looking Statements 6
   
Use of Proceeds 7
   
Selling Stockholders 8
   
Plan of Distribution 10
   
Description of Our Capital Stock 12
   
Legal Matters 15
   
Experts 15
   
Where You Can Find More Information 15
   
Incorporation of Certain Documents by Reference 16

 

 

You should read this prospectus and anyapplicable prospectus supplement before making an investment in the securities of Genius Brands International, Inc. See “WhereYou Can Find More Information” for more information. You should rely only on the information contained in this prospectusor a prospectus supplement. The Company has not authorized anyone to provide you with different information. This document maybe used only in jurisdictions where offers and sales of these securities are permitted. You should assume that information containedin this prospectus, or in any prospectus supplement, is accurate only as of any date on the front cover of the applicable document.Our business, financial condition, results of operations and prospects may have changed since that date. Unless otherwise notedin this prospectus, “Genius Brands,” “Genius,” “the Company,” “we,” “us,”“our” and similar terms refer to Genius Brands International, Inc.

 

Smaller Reporting Company – ScaledDisclosure

 

Pursuant to Item 10(f) of Regulation S-Kpromulgated under the Securities Act of 1933, as indicated herein, we have elected to comply with the scaled disclosure requirementsapplicable to “smaller reporting companies,” including providing two years of audited financial statements.

 

 

 

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PROSPECTUS SUMMARY

 

This summary highlights some informationfrom this prospectus. It may not contain all the information important to making an investment decision. You should read the followingsummary together with the more detailed information regarding our Company and the securities being sold in this offering, including“Risk Factors” and other information incorporated by reference herein.

 

Business Overview

 

Genius Brands International,Inc. (“we,” “us,” “our,” or the “Company”) is a global content and brand managementcompany that creates and licenses multimedia content. Led by industry veterans, we distribute our content in all formats as wellas a broad range of consumer products based on our characters. In the children's media sector, our portfolio features “contentwith a purpose” for toddlers to tweens, which provides enrichment as well as entertainment. New intellectual property titlesinclude the preschool property Rainbow Rangers, which debuted in November 2018 on Nickelodeon, and preschool property LlamaLlama, which debuted on Netflix in January 2018 and was renewed by Netflix for a second season. Our library titles includethe award winning Baby Genius, adventure comedy Thomas Edison's Secret Lab® and Warren Buffett's SecretMillionaires Club, created with and starring iconic investor Warren Buffett which is distributed across our Genius BrandsNetwork on Comcast’s Xfinity on Demand, AppleTV, Roku, Amazon Fire, YouTube, Amazon Prime, Cox, Dish, Sling and Zumo as wellas Connected TV. We are also developing an all-new animated series, Stan Lee's Superhero Kindergarten with Stan Lee's Pow!Entertainment. 

 

In addition, we actas licensing agent for Penguin Young Readers, a division of Penguin Random House LLC who owns or controls the underlying rightsto Llama Llama, leveraging our existing licensing infrastructure to expand this brand into new product categories,new retailers, and new territories.

 

Our Products

 

Original Content

 

We own and produceoriginal content that is meant to entertain and enrich toddlers to tweens as well as families. It is generally a three-year cyclefrom the inception of an idea, through production of the content and development and distribution of a range of consumer productsto retail, creating an inevitable lag time between the creation of the intellectual property to the realization of economic benefitof those assets. Our goal is to maintain a robust and diverse portfolio of brands, appealing to various interests and ages, featuringevergreen topics with global appeal. Our portfolio of intellectual property can be licensed, re-licensed, and exploited for yearsto come, with revenue derived from multiple sources and territories. Our portfolio of original content includes:

 

Content in Production

 

Rainbow Rangers:From Shane Morris, the writer of Frozen, and Rob Minkoff, the director of The Lion King, Rainbow Rangers isan animated series about the adventures of seven magical girls from Kaleidoscopia, a fantastic land on the other side of the rainbow.The Rangers serve as Earth’s guardians and first-responders. When there’s trouble for the people or animals of theEarth, the Rangers ride a rainbow across the sky to save the day. We have partnered with Mattel Inc.’s Fisher Price Toysas the master toy partner for the new series, and Viacom’s Nick Jr. has licensed the series for broadcast in the US. Internationalbroadcast agreements are currently being negotiated in numerous territories.

 

Llama Llama Season2: We completed production of fifteen half-hour animated episodes in 2017 which premiered on Netflix in early 2018. Netflixordered a second season of Llama Llama consisting of ten half-hour animated episodes. Back for Season 2 are LlamaLlama’s creators including Oscar-winning director Rob Minkoff (The Lion King), director Saul Blinkoff (DocMcStuffins), showrunner Joe Purdy, art director Ruben Aquino (Frozen) and Emmy-winning producers Jane Startz and AndyHeyward. Based on the NY Times #1 best-selling children’s books of the same name, the animated series centerson young Llama Llama’s first steps in growing up and facing childhood milestones. Each episode is structured around a childhoodmilestone and a life lesson learned by Llama Llama and his friends, told with a sense of humor, vitality, and understanding.

 

 

 

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Content in Development

 

Baby Genius:For more than ten years, Baby Genius has earned worldwide recognition for creating award-winning products fortoddlers. Its catalogue of 500 songs, 125 music videos, and toys features classic nursery rhymes, learning songs, classical music,holiday favorites and more. Recognizing a need in the marketplace for established pre-school content, the Baby Genius channel waslaunched featuring the award-winning collection of Baby Genius Videos along with third party content providers sharing the GeniusBrands “Content with a Purpose” message. The Baby Genius brand is synonymous with safe, enriching content for preschoolersand is being re-launched as a life style brand incorporating a new website, content and consumer products designed with today’sfamily in mind.

 

Already Released Content

 

Rainbow Rangers:We completed 26 half hour episodes in February of 2019 and the series premiered on Nick Jr. in November 2018. The series was createdby Shane Morris, the co-writer of Frozen, and Rob Minkoff, the director of The Lion King, Rainbow Rangersis an animated series about the adventures of seven magical girls from Kaleidoscopia, a fantastic land on the other side of therainbow. The Rangers serve as Earth’s guardians and first-responders. When there’s trouble for the people or animalsof the Earth, the Rangers ride a rainbow across the sky to save the day. A global licensing program is in place and the first productswill be introduced to the market in second quarter of 2019.

 

Llama Llama:We completed production of fifteen half-hour animated episodes in 2017 which premiered on Netflix in early 2018. LlamaLlama’s creators include Oscar-winning director Rob Minkoff (The Lion King), director Saul Blinkoff (Doc McStuffins),showrunner Joe Purdy, art director Ruben Aquino (Frozen) and Emmy-winning producers Jane Startz and Andy Heyward. Basedon the NY Times #1 best-selling children’s books of the same name, the animated series centers on young LlamaLlama’s first steps in growing up and facing childhood milestones. Each episode is structured around a childhood milestoneand a life lesson learned by Llama Llama and his friends, told with a sense of humor, vitality, and understanding. The global licensingprogram was unveiled in June 2016 at the Licensing Expo held in Las Vegas.

 

SpacePopSpacePop isa music and fashion driven animated property that has garnered over 17 million views and over 63,000 subscribers since its launchin May 2016. With 108 three-minute webisodes produced, SpacePop had a best-in-class production team which includedSteve Banks (head writer and story editor of Sponge Bob Square Pants) as content writer; Han Lee (Pink Fizz, Bobby Jack)for original character designs; multiple Grammy Award-winning producer and music veteran Ron Fair (Fergie, Mary J. Blige, BlackEyed Peas, Pussycat Dolls, Christina Aguilera and more), singer-songwriter Stefanie Fair (founding member of RCA’s girl groupWild Orchid with Fergie) for the original SpacePop theme music; and veteran music producer and composer John Loeffler(Kidz Bop, Pokemon) for original songs. SpacePop products range from apparel and accessories, to beauty, cosmetics,candy, books and music.

 

Thomas Edison’sSecret LabThomas Edison’s Secret Lab is a STEM-based comedy adventure series by Emmy-nominated writerSteve Banks (SpongeBob Square Pants), multi-Emmy Award-winning writer Jeffrey Scott (Dragon Tales), and Emmy Award-winningproducer Mark Young (All Dogs Go To Heaven 2). The series includes 52 eleven-minute episodes as well as 52 ninety-secondoriginal music videos produced by Grammy Award-winning producer Ron Fair. The animated series follows the adventures of Angie,a 12-year-old prodigy who, along with her young science club, discovers Thomas Edison’s secret lab.

 

Warren Buffett’sSecret Millionaire’s Club: With 26 thirty-minute episodes and 26 four-minute webisodes, this animated series featuresWarren Buffett who acts as a mentor to a group of entrepreneurial kids who have international adventures that lead them to encounterneighborhood and community problems to solve. Warren Buffett’s Secret Millionaire’s Club empowers kids by helpingthem learn about the business of life and the importance of developing healthy life habits at an early age.

 

Licensed Content

 

In addition to thewholly-owned or partially-owned properties listed above, we represent Llama Llama in the licensing and merchandising space.

 

 

 

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Genius Brands Network

 

Seeing a need for adestination devoted to providing “Content with a Purpose,” we launched the Genius Brands Network comprised of the KidGenius Cartoon Network and Baby Genius TV. The network is distributed across multiple platforms including advertising supportedvideo-on-demand (“AVOD”), subscription video-on-demand (“SVOD”) and over-the-top platforms (“OTT”)providing kids and parents a clear choice in premium entertaining, enriching and engaging programming.

 

TheKid Genius Cartoon Network provides smart TV for kids. Our shows are designed for kids to tweens and anyone in between. Our KidGenius Cartoon Network exposes kids to new and intriguing subjects that stimulate their senses and imagination on a daily basis.Parents will enjoy watching their kids be entertained with enriching and educational series. Featured series include Dino Squad,Thomas Edison's Secret Lab, Inspector Gadget and more. The Kid Genius Cartoon Channel Plus was launched in September 2017 onAmazon Prime. Kid Genius Cartoon Channel Plus is a subscription video-on-demand service available for $3.99 per month to the approximately80 million Amazon Prime members. The channel features a variety of owned and licensed content.

 

BabyGenius TV provides enriching and entertaining content for toddlers through preschoolers. Toddlers to preschoolers learn lessonsthrough music and characters that ignite their imagination. Parents will feel safe knowing that their littles ones are enjoyingthe educational content of our shows. Series include Baby Genius, Rainbow Valley Fire Department, The New Adventures of Madelineand more.

 

Distribution

 

Content

 

Today’s globalmarketplace and the manner in which content is consumed has evolved to a point where we believe there is only one viable strategy,ubiquity. Kids today expect to be able to watch what they want whenever they want and wherever they want. As such, contentcreators now must offer direct access on multiple fronts. This includes not only linear broadcast but also digital platforms. Wehave strong ties to and actively solicit placement for our content from the largest linear broadcasters such as Nickelodeon, TheDisney Channel, Cartoon Network, Sprout, and PBS. Similarly, on the digital side, we are partnered with Comcast’s Xfinityplatform as well as AppleTV, Roku, Samsung TV, Amazon Fire, Amazon Prime, Netflix, YouTube, Cox, Dish, Sling and Zumo as well asConnected TV. We replicate this model of ubiquity around the world defining content distribution strategies by market that blendsthe best of linear, VOD, and digital distribution.

 

Finally, we expandedour long-term strategic partnership with Sony Pictures Home Entertainment from domestic to global in January 2017. On August 31,2018 Sony Pictures Home Entertainment assigned all of its rights and interest in our programs to Alliance Entertainment, LLC (“AEC”).

 

Consumer Products

 

A source of our revenueis our licensing and merchandising activities from our underlying intellectual property content. We work directly in licensingproperties to a variety of manufacturers, wholesalers, and retailers. We currently have across all brands in excess of 49 licenseesand hundreds of licensed products scheduled to enter the market. Products bearing our marks can be found in a wide variety of retaildistribution outlets reaching consumers in retailers such as Wal-Mart, Target, Barnes & Noble, The Home Depot, Old Navy, Amazon.comand many more. We often negotiate dedicated retail space on a direct basis with retailers that will include branded signage togive our brands prominence and clear communication with the consumer. License agreements that we enter into often include financialguarantees and commitments from the manufacturers guaranteeing a minimum stream of revenue for us. As licensed merchandise is soldat retail, these advances and/or minimum guarantees can earn out at which point we could earn additional revenue.

 

Company Information

 

We were incorporatedin California on January 3, 2006 and reincorporated in Nevada in October 2011. We commenced operations in January 2006, assumingall of the rights and obligations of our then Chief Executive Officer, under an Asset Purchase Agreement between us and GeniusProducts, Inc., in which we obtained all rights, copyrights, and trademarks to the brands “Baby Genius,” “KidGenius,” “123 Favorite Music” and “Wee Worship,” and all then existing productions under those titles.In October 2011, we (i) changed our domicile to Nevada from California, and (ii) changed our name to Genius Brands International,Inc. from Pacific Entertainment Corporation (the “Reincorporation”). In connection with the Reincorporation, we changedour trading symbol from “PENT” to “GNUS.”

 

 

 

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Our principal executiveoffices are located at 8383 Wilshire Blvd., Suite 412, Beverly Hills, California 90211. Our telephone number is 310-273-4222. Wemaintain an Internet website at www.gnusbrands.com. The information contained on, connected to or that can be accessed via ourwebsite is not part of this prospectus.

 

Summary of Risk Factors

 

Our business is subjectto a number of risks and uncertainties that you should understand before making an investment decision. As of December 31, 2018,we had an accumulated deficit of $50,702,486. Additional risks are discussed more fully in the section entitled “Risk Factors”following this prospectus summary. These risks include, but are not limited to, the following:

 

· We have a history of net losses and our future profitability is uncertain.

 

· We may be required to raise additional funds to finance our operations; we may not be able to do so when necessary, and/or the terms of any financings may not be advantageous to us.

 

· If we lose key personnel or are unable to attract and retain necessary talent, we may be unable to continue to grow and develop our business profitably.

 

· Third parties may claim that we infringe their intellectual property, and we could suffer significant litigation or licensing expense as a result.

 

· Raising additional funds may cause dilution to our existing stockholders, restrict our operations or require us to relinquish rights to our technologies.

  

· Trading volume in our stock is low and an active trading market for our common stock may not be available on a consistent basis to provide stockholders with adequate liquidity. Our stock price may be extremely volatile, and our stockholders could lose a significant part of their investment.

 

· Concentration of ownership among our existing officers, directors and principal stockholders may prevent other stockholders from influencing significant corporate decisions and depress our stock price.

 

Registered Direct Offering of Common Stock and Warrants andConcurrent Private Placement of Warrants

 

On February 14, 2019,we entered into a Securities Purchase Agreement (the “Purchase Agreement”) with a single existing institutional investornamed therein (the “Investor”), pursuant to which we agreed to issue and sell, in a registered direct offering directlyto the Investor (the “Registered Offering”), an aggregate of 945,894 shares (the “Shares”) of common stock,par value $0.001 per share, of the Company and warrants to purchase up to an aggregate of 945,894 shares of common stock (the “RegisteredWarrants”) at a purchase price of $2.12 per Share of common stock and accompanying Registered Warrant. Each Registered Warrantwill be immediately exercisable on the date of its issuance at an exercise price of $2.12 per share and will expire one (1) yearfrom the date of issuance. The Company received $1,757,552 net proceeds from this offering.

 

In a concurrent privateplacement (the “Private Placement” and together with the Registered Offering, the “Offerings”), we agreedto issue to the Investor who participated in the Registered Offering warrants (the “Private Warrants” and collectivelywith the Registered Warrants, the “Warrants”) exercisable for one share of common stock for each Share purchased inthe Registered Offering for an aggregate of 945,894 shares of common stock at an exercise price of $2.21 per share. Each PrivateWarrant will be exercisable commencing six months and one day from the date of issuance and will expire five (5) years from thedate it becomes exercisable. The Private Warrants and the shares of our common stock issuable from time to time upon the exerciseof the Private Warrants were not registered under the Securities Act of 1933, as amended (the “Securities Act”), werenot offered pursuant to a registration statement and were offered pursuant to the exemption provided in Section 4(a)(2) underthe Securities Act, and Rule 506(b) promulgated thereunder. Shares of common stock underlying the Private Warrants are being registeredfor resale by the selling stockholders pursuant to the Registration Statement of which this prospectus forms a part. We closedsuch Offerings on February 15, 2019.

 

 

 

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THE OFFERING

 

Securities offered by the selling stockholders   945,894
     
Common Stock to be outstanding after this offering, assuming exercise of the Private Warrants issued pursuant to the Purchase Agreement   11,378,612
     
Terms of the offering   The selling stockholders and any of their pledgees, assignees and successors-in-interest may, from time to time, sell any or all of their shares covered hereby on the Nasdaq Capital Market or any other stock exchange, market or trading facility on which the shares are traded or in private transactions. These sales may be at fixed or negotiated prices. See “Plan of Distribution.”
     
Use of proceeds   We may receive up to approximately $2,090,426 in aggregate gross proceeds from cash exercises of the Private Warrants, based on the per share exercise price of the Private Warrants. Any proceeds we receive from the exercise of the Private Warrants will be used for working capital and general corporate purposes. See “Use of Proceeds.”
     
Risk Factors   See “Risk Factors” as well as other information included in this prospectus, for a discussion of factors you should read and consider carefully before investing in our securities.
     
Trading Market   Our common stock is quoted on the Nasdaq Capital Market under the symbol “GNUS.”

 

The number of shares of common stock thatwill be outstanding after this offering is based on 10,432,718 shares outstanding as of April 10, 2019 and excludes:

 

  · 1,000,000 shares of common stock issuable upon conversion of 2,120 shares of Series A Convertible Preferred Stock at a conversion price of $2.12 per share;

 

  · 1,340,415 shares of common stock issuable upon exercise of outstanding stock options to purchase our Common Stock at a weighted average exercise price of $7.14 per share;

 

  · 826,252 shares of common stock reserved for future issuance under our 2015 Incentive Plan and 2015 Amended Incentive Plan; and

 

  · 9,591,177 shares of common stock issuable upon the exercise of outstanding warrants at a weighted average exercise price of $3.08 per share.

 

 

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RISK FACTORS

 

Investing in our securitiesinvolves a high degree of risk. Before investing in our securities, you should carefully consider the risks, uncertainties andassumptions contained in this prospectus and discussed under the heading “Risk Factors” included in our most recentAnnual Report on Form 10-K for the year ended December 31, 2018, as revised or supplemented by subsequent filings, which are onfile with the SEC and are incorporated herein by reference, and which may be amended, supplemented or superseded from time totime by other reports we file with the SEC in the future. Our business, financial condition, results of operations and futuregrowth prospects could be materially and adversely affected by any of these risks. In these circumstances, the market price ofour common stock could decline, and you may lose all or part of your investment.

  

SPECIAL NOTE REGARDING FORWARD-LOOKINGSTATEMENTS

 

This prospectus (includingthe section regarding Management's Discussion and Analysis and Results of Operation) contains forward-looking statements regardingour business, financial condition, results of operations and prospects. Words such as “expects,” “anticipates,”“intends,” “plans,” “believes,” “seeks,” “estimates” and similar expressionsor variations thereof are intended to identify forward-looking statements, but are not deemed to represent an all-inclusive meansof identifying forward-looking statements as denoted in this prospectus. Additionally, statements concerning future matters areforward-looking statements. These statements include, among other things, statements regarding:

 

  · our ability to generate revenue or achieve profitability;

 

  ·   our ability to obtain additional financing on acceptable terms, if at all;

 

  · fluctuations in the results of our operations from period to period;

 

  · general economic and financial conditions;

 

  · our ability to anticipate changes in popular culture, media and movies, fashion and technology;

 

  · competitive pressure from other distributors of content and within the retail market;

 

  · our reliance on and relationships with third-party production and animation studios;

 

  · our ability to market and advertise our products;

 

  · our reliance on third-parties to promote our products;

 

  · our ability to keep pace with technological advances;

 

  · performance of our information technology and storage systems;

 

  · a disruption or breach of our internal computer systems;

 

  · our ability to retain key personnel;

 

  · the impact of federal, state or local regulations on us or our vendors and licensees;

 

 

 

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  · our ability to protect and defend against litigation, including intellectual property claims;

 

  · the volatility of our stock price;

 

  · the marketability of our stock;

 

  · our broad discretion to invest or spend the proceeds of our financings in ways with which our stockholders may not agree and may have limited ability to influence; and

 

  · other risks and uncertainties, including those listed in the section on “Risk Factors.”

 

Although forward-lookingstatements in this prospectus reflect the good faith judgment of our management, such statements can only be based on facts andfactors currently known by us. Consequently, forward-looking statements are inherently subject to risks and uncertainties and actualresults and outcomes may differ materially from the results and outcomes discussed in or anticipated by the forward-looking statements.Factors that could cause or contribute to such differences in results and outcomes include, without limitation, those specificallyaddressed under the heading “Risks Factors” above, as well as those discussed elsewhere in this prospectus. Readersare urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this prospectus.We file reports with the Securities and Exchange Commission (“SEC”) and our electronic filings with the SEC (includingour Annual Reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and any amendments to these reports)are available free of charge on the SEC’s website at http://www.sec.gov. You can also read and copy any materials we filewith the SEC at the SEC's Public Reference Room at 100 F Street, NE, Washington, DC 20549. You can obtain additional informationabout the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.

 

We undertake no obligationto revise or update any forward-looking statements in order to reflect any event or circumstance that may arise after the dateof this prospectus, except as required by law. Readers are urged to carefully review and consider the various disclosures madethroughout the entirety of this prospectus, which are designed to advise interested parties of the risks and factors that may affectour business, financial condition, results of operations and prospects.

 

USE OF PROCEEDS

 

We will not receiveany of the proceeds from the sale of securities by the selling stockholders pursuant to this prospectus. We may receive up to approximately$2,090,426 in aggregate gross proceeds from cash exercises of the Private Warrants, based on the per share exercise price of thePrivate Warrants. Any proceeds we receive from the exercise of the Private Warrants will be used for working capital and generalcorporate purposes.

  

 

 

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SELLING STOCKHOLDERS

 

The shares ofcommon stock being offered by the selling stockholders are those issuable upon the exercise of the Private Warrants. Foradditional information regarding the issuance of these securities, see “Prospectus Summary—Registered Direct Offering of Common Stock and Warrants and Concurrent Private Placement of Warrants” on page 4 of this prospectus. Weare registering the shares of common stock issuable upon exercise of the Private Warrants in order to permit the sellingstockholders to offer the shares for resale from time to time. Except for the ownership of the Private Warrants, thetransactions contemplated pursuant to the Purchase Agreement and other financings completed by us, the selling stockholdershave not had any material relationship with us within the past three years.

 

The following tablesets forth certain information with respect to each selling stockholder, including (i) the shares of our common stock beneficiallyowned by the selling stockholder prior to this offering, (ii) the number of shares being offered by the selling stockholder pursuantto this prospectus and (iii) the selling stockholder’s beneficial ownership after completion of this offering. The registrationof the shares of common stock issuable to the selling stockholders upon the exercise of the Private Warrants does not necessarilymean that the selling stockholders will sell all or any of such shares, but the number of shares and percentages set forth in thefinal two columns below assume that all shares of common stock being offered by the selling stockholders are sold.

 

The table is basedon information supplied to us by the selling stockholders, with beneficial ownership and percentage ownership determined in accordancewith the rules and regulations of the SEC and includes voting or investment power with respect to shares of stock. This informationdoes not necessarily indicate beneficial ownership for any other purpose. In computing the number of shares beneficially ownedby a selling stockholder and the percentage ownership of that selling stockholder, shares of common stock subject to warrants heldby that selling stockholder that are exercisable within 60 days after March 31, 2019, are deemed outstanding. Such shares, however,are not deemed outstanding for the purposes of computing the percentage ownership of any other person. The percentage of beneficialownership after this offering is based on 10,432,718 shares of common stock outstanding on March 31, 2019.

 

This prospectus coversthe resale of 945,894 shares of our common stock that may be sold or otherwise disposed of by the selling stockholders. Such sharesare issuable to the selling stockholders upon the exercise of the Private Warrants. The Private Warrants are exercisable at anytime after the six-month anniversary of their issuance and expire five (5) years from their initial date of issuance. All of thePrivate Warrants have an exercise price of $2.21 per share. See “Prospectus Summary —Registered Direct Offering ofCommon Stock and Warrants and Concurrent Private Placement of Warrants” above for a complete description of the Private Warrants.The selling stockholders may sell all, some or none of their shares in this offering, but the number of shares and percentagesset forth in the final two columns below assume that all shares of common stock being offered by the selling stockholders are sold.See “Plan of Distribution.”

 

Selling
Security Holder (1)
  Number of Shares
of
Common Stock
Beneficially
Owned
Prior to Offering (2)
      Number
of Shares of
Common Stock
Underlying Private Warrants Offered Hereby (3)
  Number of
Shares
of
Common Stock
Beneficially Owned
After Offering
    % of Shares
of Common
Stock Beneficially Owned
After
Offering
 
                         
Anson Investments Master Fund LP (4)     4,416,629         945,894     3,470,735 (5)     9.99%  

 

 

(1) This table and the information in the notes below are based upon information supplied by the selling stockholder, including reports and amendments thereto filed with the SEC on Schedule 13D and Schedule 13G.

 

(2) The shares of common stock underlying options or warrants are convertible or exercisable within 60 days of March 31, 2019.

 

 

 

 8 

 

 

(3) The actual number of shares of common stock offered hereby and included in the registration statement of which this prospectus forms a part includes, in accordance with Rule 416 under the Securities Act, such indeterminate number of additional shares of our common stock as may become issuable in connection with any proportionate adjustment for any stock splits, stock combinations, stock dividends, recapitalizations or similar events with respect to the common stock.

 

(4) Anson Advisors Inc. and Anson Funds Management LP, the Co-Investment Advisers of Anson Investments Master Fund LP (“Anson”), hold voting and dispositive power over the securities held by Anson. Bruce Winson is the managing member of Anson Management GP LLC, which is the general partner of Anson Funds Management LP. Moez Kassam and Adam Spears are directors of Anson Advisors Inc. Mr. Winson, Mr. Kassam and Mr. Spears each disclaim beneficial ownership of these shares of common stock except to the extent of their pecuniary interest therein. The principal business address of Anson is 190 Elgin Ave; George Town, Grand Cayman.

 

(5) Includes (i) 460,734 shares of common stock, (ii) 720,000 shares of common stock issuable upon the conversion of $1,800,000 of Senior Convertible Notes and (iii) 3,235,895 shares of common stock issuable upon exercise of certain other warrants held by Anson Investments Master Fund, LP.  The Convertible Notes may not be converted to the extent that the holder or any of its affiliates would own more than 9.99% of the outstanding common stock of the Company after such conversion. The terms of all the warrants beneficially owned include a blocker provision that restricts exercise to the extent the securities beneficially owned by the selling stockholder and its affiliates would represent beneficial ownership in excess of 4.99% of shares of our common stock outstanding immediately after giving effect to such exercise, subject to the holder’s option, which may only be exercised to the extent beneficial ownership by Anson Investments Master Fund LP, in the aggregate, does not exceed 4.99% of our common stock. The number of shares included in this column does not reflect the limitations described above.

 

 

 

 

 

 9 

 

 

PLAN OF DISTRIBUTION

 

Each selling stockholder of the securitiesand any of their pledgees, assignees and successors-in-interest may, from time to time, sell any or all of their securities coveredhereby on the Nasdaq Capital Market or any other stock exchange, market or trading facility on which the securities are tradedor in private transactions. These sales may be at fixed or negotiated prices. A selling stockholder may use any one or more ofthe following methods when selling securities:

 

  · ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
     
  · block trades in which the broker-dealer will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction;
     
  · purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
     
  · an exchange distribution in accordance with the rules of the applicable exchange;
     
  · privately negotiated transactions;
     
  · settlement of short sales;
     
  · in transactions through broker-dealers that agree with the selling stockholders to sell a specified number of such securities at a stipulated price per security;
     
  · through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;
     
  · a combination of any such methods of sale; or
     
  · any other method permitted pursuant to applicable law.

 

The selling stockholdersmay also sell securities under Rule 144 or any other exemption from registration under the Securities Act of 1933, as amended (the“Securities Act”), if available, rather than under this prospectus.

 

Broker-dealers engagedby the selling stockholders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissionsor discounts from the selling stockholders (or, if any broker-dealer acts as agent for the purchaser of securities, from the purchaser)in amounts to be negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an agency transactionnot in excess of a customary brokerage commission in compliance with FINRA Rule 2440; and in the case of a principal transactiona markup or markdown in compliance with FINRA IM-2440.

 

In connection withthe sale of the securities or interests therein, the selling stockholders may enter into hedging transactions with broker-dealersor other financial institutions, which may in turn engage in short sales of the securities in the course of hedging the positionsthey assume. The selling stockholders may also sell securities short and deliver these securities to close out their short positions,or loan or pledge the securities to broker-dealers that in turn may sell these securities. The selling stockholders may also enterinto option or other transactions with broker-dealers or other financial institutions or create one or more derivative securitieswhich require the delivery to such broker-dealer or other financial institution of securities offered by this prospectus, whichsecurities such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amendedto reflect such transaction).

 

The selling stockholdersand any broker-dealers or agents that are involved in selling the securities may be deemed to be “underwriters” withinthe meaning of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealersor agents and any profit on the resale of the securities purchased by them may be deemed to be underwriting commissions or discountsunder the Securities Act. Each selling stockholder has informed the Company that it does not have any written or oral agreementor understanding, directly or indirectly, with any person to distribute the securities.

 

 

 

 10 

 

 

The Company is requiredto pay certain fees and expenses incurred by the Company incident to the registration of the securities. The Company has agreedto indemnify the selling stockholders against certain losses, claims, damages and liabilities, including liabilities under theSecurities Act.

  

We agreed to keep thisprospectus effective until the earlier of (i) the date on which the securities may be resold by the selling stockholders withoutregistration and without regard to any volume or manner-of-sale limitations by reason of Rule 144, without the requirement forthe Company to be in compliance with the current public information under Rule 144 under the Securities Act or any other rule ofsimilar effect or (ii) all of the securities have been sold pursuant to this prospectus or Rule 144 under the Securities Act orany other rule of similar effect. The resale securities will be sold only through registered or licensed brokers or dealers ifrequired under applicable state securities laws. In addition, in certain states, the resale securities covered hereby may not besold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualificationrequirement is available and is complied with.

 

Under applicable rulesand regulations under the Exchange Act, any person engaged in the distribution of the resale securities may not simultaneouslyengage in market making activities with respect to the common stock for the applicable restricted period, as defined in RegulationM, prior to the commencement of the distribution. In addition, the selling stockholders will be subject to applicable provisionsof the Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases andsales of the common stock by the selling stockholders or any other person. We will make copies of this prospectus available tothe selling stockholders and have informed them of the need to deliver a copy of this prospectus to each purchaser at or priorto the time of the sale (including by compliance with Rule 172 under the Securities Act).

  

 

 

 

 

 

 

 

 

 

 

 

 

 11 

 

 

DESCRIPTION OF OUR CAPITAL STOCK

 

General

 

Our authorized capitalstock consists of 243,333,334 shares of capital stock, of which 233,333,334 are sharesof common stock, par value $0.001 per share, and 10,000,000 are shares of preferred stock, par value $0.001.

 

Capital Stock Issued and Outstanding

 

As of March 31, 2019,we have issued and outstanding:

 

  · 10,432,718 shares of common stock; and
     

 

  · 2,120 shares of shares of Series A Convertible Preferred Stock which are convertible into 1,000,000 shares of common stock.

 

Common Stock

 

The holders of ourcommon stock are entitled to one vote per share. In addition, the holders of our common stock will be entitled to receive ratablysuch dividends, if any, as may be declared by our Board of Directors out of legally available funds; however, the current policyof our Board of Directors is to retain earnings, if any, for operations and growth. Upon liquidation, dissolution or winding-up,the holders of our common stock will be entitled to share ratably in all assets that are legally available for distribution. Theholders of our common stock will have no preemptive, subscription, redemption or conversion rights. The rights, preferences andprivileges of holders of our common stock will be subject to, and may be adversely affected by, the rights of the holders of anyseries of preferred stock, which may be designated solely by action of our board of directors and issued in the future.

 

Preferred Stock

 

Our Board of Directorsis authorized, subject to any limitations prescribed by law, without further vote or action by our stockholders, to issue fromtime to time shares of preferred stock in one or more series. Each series of preferred stock will have such number of shares, designations,preferences, voting powers, qualifications and special or relative rights or privileges as shall be determined by our Board ofDirectors, which may include, among others, dividend rights, voting rights, liquidation preferences, conversion rights and preemptiverights.

 

Series A Convertible Preferred Stock

 

We have designatedsix thousand (6,000) shares of preferred stock as Series A Convertible Preferred Stock. Each share of Series A Preferred Stockis convertible into shares of our common stock based on a conversion calculation equal to the Base Amount divided by the conversionprice. The Base Amount is defined as the sum of (i) the aggregate stated value of the Series A Preferred Stock to be convertedand (ii) all unpaid dividends thereon. The stated value of each share of the Series A Preferred Stock is $1,000 and the initialconversion price was $6.00 per share, subject to adjustment in the event of stock splits, dividends and recapitalizations. Additionally,in the event we issue shares of our common stock or common stock equivalents at a per share price that is lower than the conversionprice then in effect, the conversion price shall be adjusted to such lower price, subject to certain exceptions. Any reductionin the conversion price could result in substantial dilution to our then-existing common stockholders as well as give rise to abeneficial conversion feature reported on our statement of operations.

  

Accordingly, the conversionprice of the Series A Convertible Preferred Stock had been adjusted downwards multiple times in connection with various equityfinancings and in connection with the closing of the Registered Offering, the conversion price of the Series A Convertible PreferredStock was adjusted to $2.12. We are prohibited from effecting a conversion of the Series A Preferred Stock to the extent that asa result of such conversion, the holder would beneficially own more than 9.99% in the aggregate of the issued and outstanding sharesof our common stock, calculated immediately after giving effect to the issuance of shares of common stock upon conversion of theSeries A Preferred Stock. The shares of Series A Preferred Stock possess no voting rights.

 

 

 

 12 

 

 

Description of Private Warrantspursuant to which the Offered Shares of Common Stock May Be Issued

 

In the PrivatePlacement completed concurrently with the Registered Direct Offering, we issued to the Investor who participated in the RegisteredOffering Private Warrants exercisable for one share of common stock for each share purchased in the Registered Offering for anaggregate of 945,894 shares of common stock at an exercise price of $2.21 per share, subject to adjustment for stock splits, reversesplits, stock dividends, and similar capital transactions as described in the Private Warrants. Each Private Warrant will be exercisablecommencing six months and one day from the date of issuance and will expire five (5) years from the date it becomes exercisable.A holder of Private Warrants will have the right to exercise such Private Warrants on a “cashless” basis if at anytime after the six-month anniversary of the closing date of the of the Offerings there is no effective registration statement registering,or no current prospectus available for, the resale of the shares of common stock underlying the Private Warrants by the holder.A holder of Private Warrants will not have the right to exercise any portion of its warrants if the holder, together with its affiliates,would beneficially own in excess of either 4.99% of the number of our shares of our common stock outstanding immediately aftergiving effect to such exercise; provided, however, that upon at least 61 days prior notice to us, a holder may increase or decreasesuch limitation up to a maximum of 9.99% of the number of shares of common stock outstanding. The Private Warrants and the sharesof our common stock issuable from time to time upon the exercise of the Private Warrants were not registered under the SecuritiesAct of 1933, as amended (the “Securities Act”), were not offered pursuant to a registration statement and were offeredpursuant to the exemption provided in Section 4(a)(2) under the Securities Act, and Rule 506(b) promulgated thereunder. Sharesof common stock underlying the Private Warrants are being registered for resale by the selling stockholders pursuant to the RegistrationStatement of which this prospectus forms a part.

 

Nevada Anti-Takeover Law and CertainCharter and Bylaw Provisions

 

Some features of theNevada Revised Statutes, which are further described below, may have the effect of deterring third parties from making takeoverbids for control of our company or may be used to hinder or delay a takeover bid. This would decrease the chance that our stockholderswould realize a premium over market price for their shares of common stock as a result of a takeover bid.

 

Acquisition of Controlling Interest

 

The Nevada RevisedStatutes contain provisions governing acquisition of a controlling interest of a Nevada corporation. These provisions provide generallythat any person or entity that acquires a certain percentage of the outstanding voting shares of a Nevada corporation may be deniedvoting rights with respect to the acquired shares, unless the holders of a majority of the voting power of the corporation, excludingshares as to which any of such acquiring person or entity, an officer or a director of the corporation, or an employee of the corporationexercises voting rights, elect to restore such voting rights in whole or in part. These provisions apply whenever a person or entityacquires shares that, but for the operation of these provisions, would bring voting power of such person or entity in the electionof directors within any of the following three ranges:

 

  · 20% or more but less than 33 1/3%;

 

  · 33 1/3% or more but less than or equal to 50%; or

 

  · more than 50%.

 

The stockholders orboard of directors of a corporation may elect to exempt the stock of the corporation from these provisions through adoption ofa provision to that effect in the articles of incorporation or bylaws of the corporation. Our articles of incorporation and bylawsdo not exempt our common stock from these provisions.

 

 

 

 13 

 

 

These provisions areapplicable only to a Nevada corporation, which:

 

  · has 200 or more stockholders of record, at least 100 of whom have addresses in Nevada appearing on the stock ledger of the corporation; and

 

  · does business in Nevada directly or through an affiliated corporation.

 

On November 20, 2013,we amended our bylaws to provide that the provisions of NRS 78.378 and 78.3793 (“Acquisition of a Controlling Interest”)shall not apply to the Company or to any acquisition of a controlling interest in the Company by any existing or future stockholder.

 

Combination with Interested Stockholder

 

The Nevada RevisedStatutes contain provisions governing combination of a Nevada corporation that has 200 or more stockholders of record with an interestedstockholder. As of March 31, 2019, we had 176 stockholders of record, not including personsor entities that hold our stock in nominee or “street name” through various brokerage firms.

 

A corporation affectedby these provisions may not engage in a combination within two years after the interested stockholder first became an interestedstockholder, unless either (i) the combination or transaction by which the interested stockholder first became an interested stockholderis approved by the board of directors before the interested stockholder first became an interested stockholder, or (ii) the combinationis approved by the board of directors and by the affirmative vote of the corporation’s stockholders representing at least60% of the outstanding voting power of the corporation not beneficially owned by the interested stockholder or the interested stockholder’saffiliates. Generally, if approval is not obtained, then after the expiration of the two-year period, the business combinationmay be consummated with the approval of the board of directors of the combination or transaction by which the interested stockholderfirst became an interested stockholder before the person became an interested stockholder, or a majority of the voting power heldby disinterested stockholders, or if the consideration to be received per share by disinterested stockholders is at least equalto the highest of:

 

  · the highest price per share paid by the interested stockholder within the two years immediately preceding the date of the announcement of the combination or within two years immediately before, or in the transaction in which he, she or it became an interested stockholder, whichever is higher;

 

  · the market value per share on the date of announcement of the combination or the date the person became an interested stockholder, whichever is higher; or

 

  · if higher for the holders of preferred stock, the highest liquidation value of the preferred stock, if any.

 

Generally, these provisionsdefine an interested stockholder as a person who is the beneficial owner, directly or indirectly, of 10% or more of the votingpower of the outstanding voting shares of a corporation. Generally, these provisions define combination to include any merger orconsolidation with an interested stockholder, or any sale, lease, exchange, mortgage, pledge, transfer or other disposition, inone transaction or a series of transactions, with an interested stockholder of assets of the corporation having:

 

  · an aggregate market value equal to 5% or more of the aggregate market value of the assets of the corporation;

 

  · an aggregate market value equal to 5% or more of the aggregate market value of all outstanding shares of the corporation; or

 

  · representing 10% or more of the earning power or net income of the corporation.

 

Articles of Incorporation and Bylaws

 

Pursuant to our Articlesof Incorporation, the existence of authorized but unissued common stock and undesignated preferred stock may enable our board ofdirectors to make more difficult or to discourage an attempt to obtain control of our Company by means of a merger, tender offer,proxy contest or otherwise, and thereby to protect the continuity of management.  If, in the due exercise of its fiduciaryobligations, the board of directors were to determine that a takeover proposal was not in our best interest, such shares couldbe issued by the board of directors without stockholder approval in one or more transactions that might prevent or render moredifficult or costly the completion of the takeover transaction by diluting the voting or other rights of the proposed acquireror insurgent stockholder group, by putting a substantial voting block in institutional or other hands that might undertake to supportthe position of the incumbent board of directors, by effecting an acquisition that might complicate or preclude the takeover, orotherwise.

 

 

 

 14 

 

 

In addition, our Articlesof Incorporation grants our board of directors broad power to establish the rights and preferences of authorized and unissued sharesof preferred stock. The issuance of shares of preferred stock could decrease the amount of earnings and assets available for distributionto holders of shares of common stock. The issuance also may adversely affect the rights and powers, including voting rights, ofthose holders and may have the effect of delaying, deterring or preventing a change in control of our Company.

 

Transfer Agent and Registrar

 

The transfer agentand registrar for our common stock is VStock Transfer LLC, 18 Lafayette Place, Woodmere, NY 11598.

 

Nasdaq Capital Market Listing

 

Our common stock ispublicly traded on the Nasdaq Capital Market under the symbol “GNUS.”

  

LEGAL MATTERS

 

Mintz, Levin, Cohn,Ferris, Glovsky and Popeo, P.C., New York, New York, will pass upon the validity of the shares of common stock being offered bythis prospectus.

 

EXPERTS

 

The consolidated financialstatements of Genius Brands International, Inc. as of December 31, 2018 and 2017 and for the years then ended incorporated by referenceherein have been audited by Squar Milner LLP, an independent registered public accounting firm, as stated in their report thereon,and have been incorporated by reference herein in reliance upon such report and upon authority of such firm as experts in accountingand auditing.

 

WHERE YOU CAN FIND MORE INFORMATION

 

We file annual, quarterlyand other periodic reports, proxy statements and other information with the SEC. You can read our SEC filings over the Internetat the SEC’s website at www.sec.gov. You may also read and copy any document we file with the SEC at its public referencefacilities at 100 F Street NE, Washington, D.C. 20549. You may also obtain copies of these documents at prescribed rates by writingto the Public Reference Section of the SEC at 100 F Street NE, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 forfurther information on the operation of the public reference facilities.

 

Our Internet addressis www.gnusbrands.com. There we make available free of charge, on or through the investor relations section of our website,annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filedpursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such materialwith the SEC. The information found on our website is not part of this prospectus.

 

 

 

 15 

 

 

INCORPORATION OF CERTAIN DOCUMENTS BYREFERENCE

 

We are “incorporatingby reference” specific documents that we file with the SEC, which means that we can disclose important information to youby referring you to those documents that are considered part of this prospectus. Information that we file subsequently with theSEC will automatically update and supersede this information. We incorporate by reference the documents listed below, and any documentsthat we file with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act, after the date of this prospectus untilthe termination of the offering of all of the securities registered pursuant to the registration statement of which this prospectusis a part (excluding any portions of such documents that have been “furnished” but not “filed” for purposesof the Exchange Act):

 

  1. Annual Report on Form 10-K for the fiscal year ended December 31, 2018 filed on April 1, 2019.

 

  2. Current Reports on Form 8-K filed on January 3, 2019, February 15, 2019, March 7, 2019 and March 18, 2019.

 

  3. The description of our common stock contained in our Form 8-A filed on November 18, 2016.

  

You may request, andwe will provide you with, a copy of these filings, at no cost, by calling us at (310) 373-4222 or by writing to us at the followingaddress:

 

Genius Brands International, Inc.

8383 Wilshire Blvd., Suite 412

Beverly Hills, CA 90211

Attn: Robert Denton

 

We maintain a websiteat http://www.gnusbrands.com. You may access our definitive proxy statements on Schedule 14A, annual reports on Form 10-K,quarterly reports on Form 10-Q, current reports on Form 8-K and periodic amendments to those reports filed or furnished pursuantto Section 13(a) or 15(d) of the Exchange Act with the SEC free of charge at our website as soon as reasonably practicable aftersuch material is electronically filed with, or furnished to, the SEC. The information contained in, or that can be accessed through,our website is not incorporated by reference in, and is not part of, this prospectus.

 

Any statement containedherein or in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or supersededfor purposes of this prospectus to the extent that a statement contained herein or therein, in any other subsequently filed documentthat also is or is deemed to be incorporated by reference herein and in this prospectus, modifies or supersedes such statement.Any statement so modified or superseded shall not be deemed, except as so modified and superseded, to constitute a part of thisprospectus.

 

Any statement madein this prospectus concerning the contents of any contract, agreement or other document is only a summary of the actual contract,agreement or other document. If we have filed or incorporated by reference any contract, agreement or other document as an exhibitto the registration statement, you should read the exhibit for a more complete understanding of the document or matter involved.Each statement regarding a contract, agreement or other document is qualified by reference to the actual document.

 

 

 

 

 16 

 

 

PART II INFORMATION NOT REQUIRED IN PROSPECTUS

 

Item 13. Other Expenses of Issuance and Distribution.

 

The following tablesets forth the costs and expenses, payable by the Company in connection with the registration and sale of the common stock beingregistered. All amounts are estimates except the SEC registration fee.

 

  Amount to be
paid ($)
 
SEC registration fee  $253 
Printing expense   2,000 
Legal fees and expenses   15,000 
Accounting fees and expenses   4,000 
Miscellaneous Fees   1,747 
Total  $23,000 

  

Item 14. Indemnification of Directors and Officers.

 

The Nevada Revised Statutes provide that:

 

  · a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, except an action by or in the right of the corporation, by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses, including attorneys’ fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with the action, suit or proceeding if he or she acted in good faith and in a manner which he or she reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful;
     

 

  · a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he or she is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses, including amounts paid in settlement and attorneys’ fees actually and reasonably incurred by him or her in connection with the defense or settlement of the action or suit if he or she acted in good faith and in a manner which he or she reasonably believed to be in or not opposed to the best interests of the corporation. Indemnification may not be made for any claim, issue or matter as to which such a person has been adjudged by a court of competent jurisdiction, after exhaustion of all appeals therefrom, to be liable to the corporation or for amounts paid in settlement to the corporation, unless and only to the extent that the court in which the action or suit was brought or other court of competent jurisdiction determines upon application that in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for such expenses as the court deems proper; and
     

 

  · to the extent that a director, officer, employee or agent of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding, or in defense of any claim, issue or matter therein, the corporation must indemnify him or her against expenses, including attorneys’ fees, actually and reasonably incurred by him or her in connection with the defense.

 

 

 

 II-1 

 

 

The Nevada Revised Statutes provide thatwe may make any discretionary indemnification only as authorized in the specific case upon a determination that indemnificationof the director, officer, employee or agent is proper in the circumstances. The determination must be made:

 

  · by our stockholders;

 

  · by our board of directors by majority vote of a quorum consisting of directors who were not parties to the action, suit or proceeding;

 

  · if a majority vote of a quorum consisting of directors who were not parties to the action, suit or proceeding so orders, by independent legal counsel in a written opinion;

 

  · if a quorum consisting of directors who were not parties to the action, suit or proceeding cannot be obtained, by independent legal counsel in a written opinion; or

 

  · by court order.

 

Our bylaws provide that our company shallindemnify each director, officer, and employee of our company, (i) against all the expenses (including attorneys’ fees, courtcosts and expert witness fees), judgments, decrees and fines actually paid in settlement in connection with any action, suit orproceeding, provided that the Board shall first have determined, in its sole judgment, thatthe person acted in good faith and in a manner that he or she reasonably believed to be in the best interests of the company. Ourbylaws also provide that our company may, in its discretion, pay the expenses (including attorneys’ fees) incurred in defendingproceeding civil action, suit or proceeding in advance of its final disposition, provided, however, that the payment of expensesincurred by a director or officer in advance of the final disposition of the proceeding shall be made only upon receipt of an undertakingby the director or officer to repay all amounts advanced if it should be ultimately determined that the director or officer isnot entitled to be indemnified under the bylaws.

 

Item 15. Recent Sales of Unregistered Securities

 

On January 27, 2016, the Company issued20,000 shares of the Company’s common stock as a conversion of 60 shares of Series A Convertible Preferred Stock at a conversionprice of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemption from registrationafforded by Section 4(a)(2) of the Securities Act, as amended.

 

On March 1, 2016, the Company issued 8,334shares of the Company’s common stock as a conversion of 25 shares of Series A Convertible Preferred Stock at a conversionprice of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemption from registrationafforded by Section 4(a)(2) of the Securities Act, as amended.

 

On March 12, 2016, the Company issued 10,000shares of the Company’s common stock valued at $2.40 per share as part of a settlement agreement with an entity that hadprovided music production services to the Company. These securities were issued solely to “accredited investors” inreliance on the exemption from registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

On April 15, 2016, the Company issued 25,000shares of the Company’s Common Stock pursuant to the conversion of 75 shares of Series A Convertible Preferred Stock at aconversion price of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemptionfrom registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

On April 25, 2016, the Company issued 16,667shares of the Company’s Common Stock pursuant to the conversion of 50 shares of Series A Convertible Preferred Stock at aconversion price of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemptionfrom registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

On May 4, 2016, we issued to our ChiefExecutive Officer, Andrew Heyward, 79,561 shares of common stock valued at $5.16 per share, the day’s closing stock price,in satisfaction of short term cash advances totaling $410,535. These securities were issued solely to “accredited investors”in reliance on the exemption from registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

 

 

 II-2 

 

 

On May 5, 2016, the Company issued 41,667shares of the Company’s Common Stock pursuant to the conversion of 125 shares of Series A Convertible Preferred Stock ata conversion price of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemptionfrom registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

On June 1, 2016, the Company issued 16,667shares of common stock for the exercise of 16,667 warrants each with an exercise price of $3.30 for total cash proceeds of $55,000.These securities were issued solely to “accredited investors” in reliance on the exemption from registration affordedby Section 4(a)(2) of the Securities Act, as amended.

 

On June 17, 2016, the Company issued 8,334shares of common stock for the exercise of 8,334 warrants each with an exercise price of $3.30 for total cash proceeds of $27,500.These securities were issued solely to “accredited investors” in reliance on the exemption from registration affordedby Section 4(a)(2) of the Securities Act, as amended.

 

On July 5, 2016, the Company issued 5,000shares of common stock for the exercise of 5,000 warrants each with an exercise price of $3.30 for total cash proceeds of $16,500.These securities were issued solely to “accredited investors” in reliance on the exemption from registration affordedby Section 4(a)(2) of the Securities Act, as amended.

 

On July 19, 2016, the Company issued 2,500shares of common stock valued at $6.00 per share, the day’s closing stock price, to a vendor for services rendered. Thesesecurities were issued solely to “accredited investors” in reliance on the exemption from registration afforded bySection 4(a)(2) of the Securities Act, as amended.

 

On July 22, 2016, the Company issued 3,334shares of common stock for the exercise of 3,334 warrants each with an exercise price of $3.30 for total cash proceeds of $11,000.These securities were issued solely to “accredited investors” in reliance on the exemption from registration affordedby Section 4(a)(2) of the Securities Act, as amended.

 

On December 19, 2016, the Company issued20,000 shares of the Company’s Common Stock pursuant to the conversion of 60 shares of Series A Convertible Preferred Stockat a conversion price of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemptionfrom registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

On January 10, 2017, the Company enteredinto an amendment of its home entertainment distribution agreement with Sony Pictures Home Entertainment Inc. (“SPHE”)pursuant to which, among other things, SPHE agreed to pay $1,489,583 which was owed and payable by the Company to SPHE’ssister company Sony DADC US Inc. for certain disk manufacturing and replication services. In connection with such transaction,the Company issued SPHE 301,231 shares of its Common Stock at $4.945 per share, SPHE’s exclusive territory for exercisingits home entertainment distribution rights under the Distribution Agreement was extended from the United States and Canada to worldwide,and the amount of advances subject to recoupment by SPHE out of royalty payments that would otherwise be due to the Company underthe Distribution Agreement was increased by the amount of the payment to Sony DADC US Inc. In connection with the above issuanceof our shares, the Company entered into a subscription agreement with SPHE, effective as of January 17, 2017.

 

On January 13, 2017, the Company issued20,000 shares of the Company’s Common Stock pursuant to the conversion of 60 shares of Series A Convertible Preferred Stockat a conversion price of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemptionfrom registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

On January 17, 2017, the Company issued10,112 shares of our Common Stock valued at $4.945 per share to a consultant for services rendered. The securities referenced abovewere issued solely to “accredited investors” in reliance on the exemption from registration afforded by Section 4(a)(2)of the Securities Act, as amended.

 

On January 23, 2017, the Company issued80,000 shares of the Company’s Common Stock pursuant to the conversion of 240 shares of Series A Convertible Preferred Stockat a conversion price of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemptionfrom registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

 

 

 II-3 

 

 

On February 9, 2017, the Company enteredinto a private transaction pursuant to a Warrant Exercise Agreement (the “Agreement”) with certain holders of the Company’sexisting warrants (the “Original Warrants”). The Original Warrants were originally issued on November 3, 2015, to purchasean aggregate of 1,443,334 shares of the Company’s common stock, par value $0.001 per share, at an exercise price of $3.30per share and were to expire on November 3, 2020. Pursuant to the Agreement, the holders of the Original Warrants exercised theirOriginal Warrants in full and the Company issued to each such holder new warrants, with the new warrants being identical to theOriginal Warrants except that the termination date of such new warrants is February 10, 2022 (the “Reload Warrants”).In addition, the Company also issued to the holders another new warrant, identical to the Original Warrant except that the exerciseprice of such warrant is $5.30, such warrant became exercisable on August 10, 2017 (the “Market Price Warrants” andtogether with the Reload Warrants, the “New Warrants”). The New Warrants were not registered under the Securities Actof 1933, as amended (the Securities Act), or state securities laws. The New Warrants were issued in reliance on the exemption fromregistration provided by Section 4(a)(2) under the Securities Act of 1933, as amended.

 

On February 9, 2017, the Company issued50,000 shares of the Company’s Common Stock pursuant to the conversion of 150 shares of Series A Convertible Preferred Stockat a conversion price of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemptionfrom registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

On March 14, 2017, the Company issued 8,410shares of Common Stock valued at $5.95 per share to a consultant for services rendered. The securities referenced above were issuedsolely to “accredited investors” in reliance on the exemption from registration afforded by Section 4(a)(2) of theSecurities Act, as amended.

 

On April 13, 2017, the Company issued 35,000shares of the Company’s Common Stock pursuant to the conversion of 105 shares of Series A Convertible Preferred Stock ata conversion price of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemptionfrom registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

On April 26, 2017, the Company issued 70,000shares of the Company’s Common Stock pursuant to the conversion of 210 shares of Series A Convertible Preferred Stock ata conversion price of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemptionfrom registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

On April 28, 2017, the Company issued 70,000shares of the Company’s Common Stock pursuant to the conversion of 210 shares of Series A Convertible Preferred Stock ata conversion price of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemptionfrom registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

On May 9, 2017, the Company issued 70,000shares of the Company’s Common Stock pursuant to the conversion of 210 shares of Series A Convertible Preferred Stock ata conversion price of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemptionfrom registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

On August 1, 2017, the Company issued 35,000shares of the Company’s Common Stock pursuant to the conversion of 105 shares of Series A Convertible Preferred Stock ata conversion price of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemptionfrom registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

On August 1, 2017, the Company issued 6,012shares of Common Stock valued at $4.99 per share to a consultant for services rendered. These securities were issued solely to“accredited investors” in reliance on the exemption from registration afforded by Section 4(a)(2) of the SecuritiesAct, as amended.

 

On October 3, 2017, the Company issuedwarrants to purchase 1,647,691 shares of Common Stock. The issuance and sale of these warrants were exempt from registration pursuantto Section 4(a)(2) of the Securities Act of 1933. They are being registered for resale by the selling security holders pursuantto this Registration Statement.

 

 

 

 II-4 

 

 

On November 1, 2017, the Company issued25,000 shares of the Company’s Common Stock pursuant to the conversion of 75 shares of Series A Convertible Preferred Stockat a conversion price of $3.00. These securities were issued solely to “accredited investors” in reliance on the exemptionfrom registration afforded by Section 4(a)(2) of the Securities Act, as amended.

 

On January 8, 2018, the Company enteredinto a Securities Purchase Agreement with certain accredited investors pursuant to which the Company sold approximately $1,800,000of common stock and warrants to such investors (the “January 2018 Private Placement”). The Company issued and soldwarrants to purchase 592,000 shares of Common Stock at an exercise price of $3.00 per share. In addition, the Company issued toChardan Capital Markets, LLC, as placement agent, warrants to purchase 93,000 shares of common stock at an exercise price of $3.00per share. The January 2018 Private Placement is exempt from registration pursuant to the exemption for transactions by an issuernot involving any public offering under Section 4(a)(2) the Securities Act and Regulation D under the Securities Act.

 

On August 17, 2018, the Company enteredinto a Securities Purchase Agreement (the “Purchase Agreement”) with certain accredited investors, pursuant to whichthe Company issued and sold (the “August 2018 Offering”) (i) an aggregate principal amount of $4.50 million in SecuredConvertible Notes (the “Convertible Notes”), convertible into shares of common stock of the Company, par value $0.001per share, at a conversion price of $2.50 per share and (ii) warrants to purchase 1,800,000 shares of common stock at an exerciseprice of $3.00 per share. The Convertible Notes, Warrants and the shares of common stock issuable upon conversion and exerciseof the Convertible Notes and Warrants were issued and sold in reliance upon the exemption from registration contained in Section4(a)(2) of the Securities Act and Rule 506(b) of Regulation D promulgated thereunder.

 

In exchange for freelance animationservices, the Company issued a total of 643,302 shares of common stock to a vendor in the following three installments, with theshares valued at the closing price of each issuance date: (i) 277,508 shares of common stock, valued at $2.81 per share, on May7, 2018; (ii) 180,683 shares of common stock, valued at $2.64 per share, on August 13, 2018; (iii) 141,014 shares of common stock,valued at $2.17 per share, on September 18, 2018; and (iv) 44,097 shares of common stock, valued at $2.27, on November 1, 2018.These securities were issued in reliance on the exemption from registration afforded by Section 4(a)(2) of the Securities Act.

 

On October 17, 2018, the Company issued58,614 shares of the Company’s common stock valued at $2.45 per share to various providers for investor relations services.These securities were issued in reliance on the exemption from registration afforded by Section 4(a)(2) of the Securities Act.

 

On November 15, 2018, the Company issued23,148 shares of the Company’s common stock valued at $2.16 per share for investor relations services. These securities wereissued in reliance on the exemption from registration afforded by Section 4(a)(2) of the Securities Act.

 

On December 31, 2018, the Company issued60,000 shares of the Company’s common stock valued at $2.16 per as part of a mediation settlement representing participationamounts due. These securities were issued in reliance on the exemption from registration afforded by Section 4(a)(2) of the SecuritiesAct.

 

On February 14, 2019, we entered into aSecurities Purchase Agreement (the “Purchase Agreement”) with a single existing institutional investor named therein(the “Investor”), pursuant to which we agreed to issue and sell, in a registered direct offering directly to the Investor(the “Registered Offering”), an aggregate of 945,894 shares (the “Shares”) of common stock, par value $0.001per share, of the Company and warrants to purchase up to an aggregate of 945,894 shares of common stock (the “RegisteredWarrants”) at a purchase price of $2.12 per Share of common stock and accompanying Registered Warrant. Each Registered Warrantwill be immediately exercisable on the date of its issuance at an exercise price of $2.12 per share and will expire one (1) yearfrom the date of issuance. In a concurrent private placement (the “Private Placement” and together with the RegisteredOffering, the “Offerings”), we agreed to issue to the Investor who participated in the Registered Offering warrants(the “Private Warrants” and collectively with the Registered Warrants, the “Warrants”) exercisable forone share of common stock for each Share purchased in the Registered Offering for an aggregate of 945,894 shares of common stockat an exercise price of $2.21 per share. Each Private Warrant will be exercisable commencing six months and one day from the dateof issuance and will expire five (5) years from the date it becomes exercisable. The Private Warrants and the shares of our commonstock issuable from time to time upon the exercise of the Private Warrants were not registered under the Securities Act of 1933,as amended (the “Securities Act”), were not offered pursuant to a registration statement and were offered pursuantto the exemption provided in Section 4(a)(2) under the Securities Act, and Rule 506(b) promulgated thereunder.

 

 

 

 II-5 

 

 

Item 16. Exhibits and Financial Statement Schedules.

 

See Exhibit Index following the signaturepage to this Registration Statement.

  

Item 17. Undertakings.

 

(a)The undersigned registrant hereby undertakes:

 

(1) To file, duringany period in which offers, or sales are being made, a post-effective amendment to this registration statement:

 

(i) To include any prospectusrequired by Section 10(a)(3) of the Securities Act of 1933;

 

(ii) To reflect in theprospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effectiveamendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in theregistration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollarvalue of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimatedmaximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in theaggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price setforth in the “Calculation of Registration Fee” table in the effective registration statement.

 

(iii) To include anymaterial information with respect to the plan of distribution not previously disclosed in the registration statement or any materialchange to such information in the registration statement;

 

provided, however,that paragraphs (a)(1)(i) and (a)(1)(ii) of this section do not apply if the registration statement is on Form S-3 or Form F-3and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed withor furnished to the SEC by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that areincorporated 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 purposeof determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registrationstatement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be theinitial bona fide offering thereof.

 

(3) To remove fromregistration by means of a post-effective amendment any of the securities being registered which remain unsold at the terminationof the offering.

 

(4) That, for the purposeof determining liability under the Securities Act of 1933 to any purchaser: each prospectus filed pursuant to Rule 424(b) as partof a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectusesfiled in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is firstused after effectiveness; provided, however, that no statement made in a registration statement or prospectus that is part of theregistration statement or made in a document incorporated or deemed incorporated by reference into the registration statement orprospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such firstuse, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registrationstatement or made in any such document immediately prior to such date of first use.

 

(b) The undersignedregistrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of theregistrant’s annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 (and, whereapplicable, each filing of an employee benefit plan’s annual report pursuant to section 15(d) of the Securities ExchangeAct of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statementrelating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initialbona fide offering thereof.

 

 

 

 II-6 

 

 

(c) Insofar as indemnificationfor liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of theregistrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securitiesand 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 incurredor 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 registrantwill, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriatejurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governedby the final adjudication of such issue. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 II-7 

 

 

SIGNATURES

 

 

Pursuant to the requirements of the SecuritiesAct of 1933, the registrant has duly caused this Registration Statement on Form S-1 to be signed on its behalf by the undersigned,thereunto duly authorized, in the City of Beverly Hills, State of California, on April 12, 2019.

 

  GENIUS BRANDS INTERNATIONAL, INC.
   
  By:    /s/ Andy Heyward
  Andy Heyward
  Chairman and Chief Executive Officer

 

 

POWER OF ATTORNEY

 

We, the undersigned officers and directorsof Genius Brands International, Inc., hereby severally constitute and appoint Andy Heyward and Robert Denton, and each of themsingly, our true and lawful attorneys, with full power to them, and to each of them singly, to sign for us and in our names inthe capacities indicated below, the registration statement on Form S-1 filed herewith, and any and all pre-effective and post-effectiveamendments to said registration statement, and any registration statement filed pursuant to Rule 462(b) under the Securities Actof 1933, as amended, in connection with the registration under the Securities Act of 1933, as amended, of equity securities ofthe Company, and to file or cause to be filed the same, with all exhibits thereto and other documents in connection therewith,with the Securities and Exchange Commission, granting unto said attorneys, and each of them, full power and authority to do andperform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposesas each of us might or could do in person, and hereby ratifying and confirming all that said attorneys, and each of them, or theirsubstitute or substitutes, shall do or cause to be done by virtue of this Power of Attorney.

 

Pursuant to the requirements of the SecuritiesAct of 1933, this Registration Statement on Form S-1 has been signed below by the following persons in the capacities and on thedates indicated.

 

 

Signature   Title   Date
         
/s/ Andy Heyward   Chairman and Chief Executive Officer   April 12, 2019
Andy Heyward   (Principal Executive Officer)    
         
/s/ Robert Denton  

Chief Financial Officer

(Principal Financial and Accounting Officer)

  April 12, 2019
Robert Denton
         
/s/ Bernard Cahill   Director   April 12, 2019
Bernard Cahill        
         
/s/ Joseph “Gray” Davis   Director   April 12, 2019
Joseph “Gray” Davis        
         
/s/ P. Clark Hallren   Director   April 12, 2019
P. Clark Hallren        
         
/s/ Anthony Thomopoulos   Director   April 12, 2019
Anthony Thomopoulos        
         
/s/ Margaret Loesch   Director   April 12, 2019
Margaret Loesch        
         
/s/ Lynne Segall   Director   April 12, 2019
Lynne Segall        
         
/s/ Michael Klein   Director   April 12, 2019
Michael Klein        

 

 

 

 

 II-8 

 

 

EXHIBIT INDEX

 

The exhibits listedbelow are filed as part of or incorporated by reference into this Registration Statement on Form S-1. Where certain exhibits areincorporated by reference from a previous filing, the exhibit numbers and previous filings are identified in parentheses. Wherecertain exhibits are incorporated by reference from a previous filing, the exhibit numbers and previous filings are identifiedin parentheses.

 

2.1 Agreement and Plan of Reorganization between Genius Brands International, Inc., A Squared Entertainment LLC, A Squared Holdings LLC and A2E Acquisition LLC dated November 15, 2013 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on November 20, 2013)
3.1 Articles of Incorporation of Genius Brands International Inc., as amended (Incorporated by reference to the Company’s Current Report on Form 8-K, filed with the SEC on December 2, 2011)
3.2 Bylaws of Genius Brands International, Inc., as amended (Incorporated by reference to the Company’s Current Report on Form 8-K, filed with the SEC on October 21, 2011)
4.1 Form of Placement Agent Warrant (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on May 19, 2014)
4.2 Form of Warrant (November 2015) (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on November 4, 2015)
4.3 Form of Subordinated Indenture (Incorporated by reference from Registration Statement on Form S-3 filed with the SEC on November 25, 2016)
4.4 Form of Reload Warrant (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on February 13, 2017)
4.5 Form of Market Price Warrant (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on February 13, 2017)
4.6 Form of Investor Warrant (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on October 3, 2017)
4.7 Form of Investor Warrant (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on January 8, 2018)
4.8 Form of Secured Convertible Note (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on August 17, 2018)
4.9 Form of Common Stock Purchase Warrant (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on August 17, 2018)
4.10 Form of Registered Warrant (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on February 15, 2019)
4.11 Form of Private Warrant (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on February 15, 2019)
4.12 Form of Waiver Warrant (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on February 15, 2019)
5.1* Opinion of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
10.1† 2008 Stock Option Plan (Incorporated by reference from Registration Statement on Form 10 filed with the SEC on May 4, 2011)
10.2† First Amendment to 2008 Stock Option Plan (Incorporated by reference from Registration Statement on Form 10 filed with the SEC on May 4, 2011)
10.3† Second Amendment to 2008 Stock Option Plan (Incorporated by reference from Registration Statement on Form 10 filed with the SEC on May 4, 2011)
10.4† Form of Stock Option Grant Notice (Incorporated by reference from Registration Statement on Form 10 filed with the SEC on May 4, 2011)
10.5 Form of Registration Rights Agreement between Genius Brands International, Inc. and the Investors signatory thereto (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on November 20, 2013)
10.6† Employment Agreement dated November 15, 2013 between Genius Brands International, Inc. and Andrew Heyward (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on November 20, 2013)
10.7 Engagement Letter dated November 15, 2013 between Genius Brands International, Inc. and ROAR LLC (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on November 20, 2013)
10.8 Form of Securities Purchase Agreement (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on May 19, 2014)

 

 

 

 II-9 

 

 

10.9 Form of Registration Rights Agreement (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on May 19, 2014)
10.10† Genius Brands International, Inc. 2015 Incentive Plan, as amended (Incorporated by reference to the Company’s Quarterly Report on Form 10-Q filed on November 14, 2017)
10.11 Form of Securities Purchase Agreement (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on November 4, 2015)
10.12 Form of Registration Rights Agreement (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on November 4, 2015)
10.13 Loan and Security Agreement dated August 5, 2016 between Genius Brands International, Inc. and Llama Productions LLC (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on August 12, 2016)
10.14 Subscription Agreement dated January 17, 2017 between Genius Brands International, Inc. and Sony DADC USA, Inc. (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on January 17, 2017)
10.15 Form of Warrant Exercise Agreement dated February 9, 2017 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on February 10, 2017)
10.16 Securities Purchase Agreement dated October 3, 2017 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on October 3, 2017)
10.17 Securities Purchase Agreement dated January 8, 2018 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on January 8, 2018)
10.18† Employment Agreement dated April 18, 2018 between Genius Brands International, Inc. and Robert Denton (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on April 5, 2018)
10.19 Securities Purchase Agreement dated August 17, 2018 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on August 17, 2018)
10.20 Registration Rights Agreement dated August 17, 2018 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on August 17, 2018)
10.21 Loan and Security Agreement dated September 28, 2018, by and between Llama Productions LLC and Bank Leumi USA (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on October 4, 2018)
10.22 Amendment No. 2 to Loan and Security Agreement, effective as of August 27, 2018, by and between Llama Productions LLC and Bank Leumi USA (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on October 4, 2018)
10.23† Amended and Restated Employment Agreement dated November 16, 2018 between Genius Brands International, Inc. and Andrew Heyward (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on November 19, 2018)
10.24† Employment Agreement dated April 16, 2018 between Genius Brands International, Inc. and Michael Jaffa (Incorporated by reference to the Company’s Annual Report on Form 10-K filed with the SEC on April1, 2019)
10.25 Form of Securities Purchase Agreement dated as of February 14, 2019, by and among Genius Brands International,Inc. and the signatories identified therein (Incorporatedby reference to the Company’s Current Report on Form 8-K filed with the SEC on February 15, 2019)
10.26 Form of Amendment, Waiver and Consent Agreement dated as of February 14, 2019, by and among Genius BrandsInternational, Inc. and the signatories identified therein (Incorporatedby reference to the Company’s Current Report on Form 8-K filed with the SEC on February 15, 2019)
21.1 List of Subsidiaries (Incorporated by reference to the Company’s Annual Report on Form 10-K filed with the SEC on April 1, 2019)
23.1* Consent of Squar Milner LLP, independent registered public accounting firm for the Company
23.2 Consent of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. (included in Exhibit 5.1)
24.1   Power of Attorney (included on signature page hereto)
101.1

The following financial information from the Genius Brands International, Inc. Annual Report on Form 10-K for the year ended December 31, 2018 formatted in XBRL; (i) Consolidated Balance Sheets, December 31, 2018 and December 31, 2017; (ii) Consolidated Statements of Operations, Years Ended December 31, 2018 and 2017; (iii) Consolidated Statements of Comprehensive Income (Loss), Years Ended December 31, 2018 and 2017; (iv) Consolidated Statements of Cash Flows, Years Ended December 31, 2018 and 2017; and (v) Consolidated Statements of Stockholders' Equity for the Years Ended December 31, 2018 and 2017; and (vi) Notes to Consolidated Financial Statements (incorporated by reference herein to the exhibits to the Company's 2018 Annual Report on Form 10-K filed April 1, 2019 (File No. 001-37950)).

 

 

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* Filed herewith.
Management contract or compensatory plan or arrangement.

 

 

 

 

 

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