Jakks Pacific, Inc. announced that an arbitration with THQ over the rate of Jakks’ preferred return payment from WWE video game sales generated by the THQ/Jakks joint venture for the period July 1, 2006 through December 31, 2009, has resulted in a determination by the arbitrator that JAKKS is entitled to receive a preferred return payment at a rate of 6% of net sales of the WWE video games sold by the joint venture, rather than the 10% rate that had been accrued by JAKKS and THQ pending the arbitrator’s decision.

The arbitration award requires THQ to pay Jakks approximately $34 million on account of the preferred return for the period from July 1, 2006 through March 31, 2009. As a result of the decision, Jakks will reduce its receivable from THQ from approximately $57 million to approximately $34 million and take a non-cash charge of approximately $22.5 million in the second quarter.