<PAGE>
                                                                   EXHIBIT 10.33


                         REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT dated as of December 27, 2001 is entered
into by and among JAKKS Pacific, Inc., a Delaware corporation ("JAKKS "), and
David S. Lipman, Marilyn Lipman and John Nimmo (together the "Shareholders" and
each a "Shareholder").

                              W I T N E S S E T H:
                              - - - - - - - - - -


        WHEREAS, JAKKS has this date acquired from the Shareholders all of the
outstanding capital stock of Kidz Biz Limited, a private limited company
incorporated under the law of England and Wales and Kidz Biz Far East Limited, a
Hong Kong corporation (collectively, the "Kidz Biz Companies" and the
acquisition of the shares of the Kidz Biz Companies is referred to as the
"Acquisition"), pursuant to a Stock Purchase Agreement of even date herewith
(the "Stock Purchase Agreement"); and

        WHEREAS, a portion of the purchase price for the Acquisition consists of
shares of JAKKS' common stock, and in order to induce the Shareholders to enter
into the Stock Purchase Agreement and close the Acquisition, JAKKS has agreed to
enter into this Agreement regarding registration of such shares of JAKKS' common
stock.

        NOW, THEREFORE, in consideration of the premises and the mutual
covenants hereinafter set forth, the parties hereto hereby agree as follows:


1.   Certain Definitions.

1.1  "Agent" means David S. Lipman, one of the Shareholders.

1.2  "Agreement" means this Registration Rights Agreement, as amended or
supplemented.

1.3  "Blue Sky Laws" means the laws of any state, the District of Columbia, or
any territory or other jurisdiction in the United States governing the purchase
and/or sale of securities in such jurisdiction.

1.4  "Commission" means the U.S. Securities and Exchange Commission.

1.5  "Common Stock" means shares of JAKKS' common stock, par value $.001 per
share.

1.6  "Exchange Act" means the U.S. Securities Exchange Act of 1934, as amended.


1.7  "Inspectors" has the meaning provided for in Section 3.1 below.

1.8  "JAKKS Securities Claims" has the meaning provided for in Section 7.2
below.

1.9  "JAKKS Shares" means the shares of Common Stock delivered as part of the
Closing Purchase Price or which may be delivered in payment of the Earn-Out
under the Stock Purchase Agreement.


                                       1
<PAGE>

1.10 "Notice" means giving any notice to, or making any declaration or filing,
or registration or recordation, with any Person.

1.11 "Person" includes without limitation a natural person, corporation, joint
stock company, limited liability company, partnership, joint venture,
association, trust, Governmental Authority, or any group of the foregoing acting
in concert.

1.12 "Proceeding" means any action, suit, arbitration, audit, investigation or
other proceeding, at law or in equity, before or by any Governmental Authority.

1.13 "Order" means any judgment, order, writ, decree, award, directive, ruling
or decision of any Governmental Authority.

1.14 "Records" has the meaning provided for in Section 3.1 below.

1.15 The terms "register," "registered," "registration" and "registration
statement" shall refer to a registration of securities to be offered and sold
under a registration statement filed with the Commission, that becomes effective
pursuant to the Securities Act or the Exchange Act and the applicable rules and
regulations under either such Act.

1.16 "Registrable Securities" has the meaning provided for in Section 2.1 below.

1.17 "Securities Act" means the U.S. Securities Act of 1933, as amended.

1.18 "Shareholders Securities Claims" has the meaning provided for in Section
7.1 below.


2.   Registration Rights.

2.1  Registration Statement. JAKKS shall prepare a Registration Statement on
Form S-3 (or, if Form S-3 is not then available, on such form of registration
statement as is then available to effect a registration of all of the
Registrable Securities, subject to the consent of the Shareholders (as
determined pursuant to Section 5 hereof)), and file the same with the
Commission, in the case of Registrable Securities included in the Closing
Purchase Price, on or prior to March 1, 2002, and, in the case of Registrable
Securities included in the Earn-Out, if any, within two (2) months after the
date of issuance thereof, covering the JAKKS Shares (the "Registrable
Securities"), and shall use its best efforts to cause each such registration
statement to become effective as soon as practicable, but in no event later than
within three (3) months, after the Closing Date, in the case of Registrable
Securities included in the Closing Purchase Price, or the date of issuance, in
the case of Registrable Securities included in the Earn-Out, if any, to permit,
when such registration statement becomes effective, the sale of the Registrable
Securities in the public securities markets.

2.2  Incidental Registrations. If at any time prior to the date on which the
Registration statement becomes effective, JAKKS shall file with the Commission a
registration statement relating to an offering for its own account or the
account of others under the Securities Act of any of its equity securities
(other than on Form S-4 or Form S-8 or their then equivalents relating to equity
securities to be issued solely in connection with an acquisition of any entity
or business or equity securities issuable in connection with



                                       2
<PAGE>

stock option or other employee benefit plans), then JAKKS shall send to each
Shareholder written notice of such determination and, if within fifteen (15)
days after the date of such notice, any Shareholder shall so request in writing,
JAKKS shall include in such Registration Statement all or any part of the
Registrable Securities such Shareholder requests to be registered, except that
if, in connection with any underwritten public offering, the managing
underwriter(s) thereof shall impose a limitation on the number of shares of
Common Stock which may be included in the Registration Statement because, in
such underwriter(s)' judgment, marketing or other factors dictate such
limitation is necessary to facilitate public distribution, then JAKKS shall be
obligated to include in such Registration Statement only such limited portion of
the Registrable Securities with respect to which such Shareholder has requested
inclusion hereunder as the underwriter shall permit. Any exclusion of
Registrable Securities shall be made pro rata among the Shareholders seeking to
include Registrable Securities, in proportion to the number of Registrable
Securities sought to be included by such Shareholders; provided, however, that
JAKKS shall not exclude any Registrable Securities unless JAKKS has first
excluded all outstanding securities, the holders of which are not entitled to
inclusion of such securities in such Registration Statement or are not entitled
to pro rata inclusion with the Registrable Securities; and provided, further,
however, that, after giving effect to the immediately preceding proviso, any
exclusion of Registrable Securities shall be made pro rata with holders of other
securities having the right to include such securities in the Registration
Statement. No right to registration of Registrable Securities under this Section
2.2 shall be construed to limit any registration required under Section 2.1
hereof. If an offering in connection with which a Shareholder is entitled to
registration under this Section 2.2 is an underwritten offering, then each
Shareholder whose Registrable Securities are included in such Registration
Statement shall, unless otherwise agreed by JAKKS, offer and sell such
Registrable Securities in an underwritten offering using the same underwriter or
underwriters and, subject to the provisions of this Agreement, on the same terms
and conditions as other shares of Common Stock included in such underwritten
offering.

2.3  Limitation on Sales of JAKKS Shares. Each of David S. Lipman and Marilyn
Lipman shall not sell, assign, pledge or otherwise transfer, or engage in
short-selling or hedging transactions with respect to, any Registrable
Securities held by him or her, notwithstanding that such securities may have
been registered for sale under the Securities Act, in any calendar quarter of
2002, in excess of the number set forth below:

<TABLE>
<CAPTION>
             Quarter               Number of Shares
             -------               ----------------

             <S>    <C>
               1    25% of JAKKS Shares initially issued to both such
                    Shareholders

               2    50% of JAKKS Shares initially issued to both such
                    Shareholders, less the number of such Shares sold hereunder
                    by both such Shareholders in the prior quarter

               3    75% of JAKKS Shares initially issued to both such
                    Shareholders, less the number of such Shares sold hereunder
                    by both such Shareholders in the prior two quarters

               4    100% of JAKKS Shares initially issued to both such
                    Shareholders, less the number of such Shares sold hereunder
                    by both such Shareholders in the prior three quarters
</TABLE>


                                       3
<PAGE>

2.4  Preparation and Filing of Registration Statement. With respect to any
Registration Statement to be prepared by JAKKS under this Agreement, JAKKS
shall, at its sole expense, as expeditiously as practicable:

     (i)     prepare and file with the Commission a registration statement
     necessary to permit the sale of the Registrable Securities in the public
     securities markets when such registration statement becomes effective and
     use its best efforts to keep the Registration Statement effective pursuant
     to Rule 415 at all times until such date as is the earlier of (i) the date
     on which all of the Registrable Securities have been sold and (ii) the date
     on which all of the Registrable Securities (in the reasonable opinion of
     counsel to Shareholders) may be immediately sold to the public without
     registration and without restriction as to the number of Registrable
     Securities to be sold, whether pursuant to Rule 144 or otherwise (the
     "Registration Period").

     (ii)    prepare and file with the Commission such amendments and
     supplements to such Registration Statement and the prospectus included
     therein as may be necessary, to keep the Registration Statement effective
     at all times during the Registration Period, and, during such period,
     comply with the provisions of the Securities Act with respect to the
     disposition of all Registrable Securities of JAKKS covered by the
     Registration Statement until the termination of the Registration Period.
     JAKKS shall use its best efforts to cause such amendments to become
     effective as soon as practicable following the filing thereof.

     (iii)   furnish to the Agent (a) promptly after the same is prepared and
     publicly distributed, filed with the Commission, or received by JAKKS, one
     copy of the Registration Statement and any amendment thereto, each
     preliminary prospectus and prospectus and each amendment or supplement
     thereto, and, in the case of a Registration Statement referred to in
     Section 2.1, each written correspondence by or on behalf of JAKKS to the
     Commission or the staff of the Commission, and each item of correspondence
     from the Commission or the staff of the Commission, in each case relating
     to such Registration Statement (other than any portion, if any, thereof
     which contains information for which JAKKS has sought confidential
     treatment), and (b) such number of conformed copies of such registration
     statement and of each amendment or supplement thereto (in each case
     including all exhibits and documents incorporated therein by reference),
     such number of copies of any prospectus included in such registration
     statement and such other documents, in each case, as the Agent may
     reasonably request in order to facilitate the sale of the Registrable
     Securities in the public securities markets;

     (iv)    use its best efforts to register or to qualify the Registrable
     Securities under the Blue Sky Laws of each state governing further purchase
     or sale of securities as the Agent may reasonably request, to keep such
     registration or qualification in effect for so long as such registration
     statement remains in effect and take any other action that may be
     reasonably necessary or advisable to enable the Shareholders to consummate
     the disposition in such states of the Registrable Securities; provided that
     JAKKS shall not be required to keep such registration or qualification in
     effect at any time after the disposition of the Registrable Securities in
     accordance with the manner of disposition set forth in the registration
     statement relating thereto; and provided, further, that JAKKS will not be
     required to (A) qualify generally to do business in any jurisdiction where
     it would not otherwise be required to qualify but for this paragraph or (B)
     subject itself to taxation in any such jurisdiction;

     (v)     notify the Agent as expeditiously as practicable, and confirm such
     advice in writing:


                                       4
<PAGE>

          (1)  when the registration statement or any amendment thereto has been
          filed and when it has become effective;

          (2)  of the issuance by the Commission of any stop order suspending
          the effectiveness of the registration statement or the initiation of
          any proceedings for that purpose; and

          (3)  of the registration or qualification of the Registrable
          Securities for sale under the Blue Sky Laws of any jurisdiction
          affecting such registration or qualification;

          (4)  of the happening of any event as a result of which the prospectus
          included in the Registration Statement, as then in effect, includes an
          untrue statement of a material fact or omission to state a material
          fact required to be stated therein or necessary to make the statements
          therein not misleading, and use its best efforts to as soon as
          possible (but in any event it shall within five (5) days) prepare a
          supplement or amendment to the Registration Statement to correct such
          untrue statement or omission, and deliver such number of copies of
          such supplement or amendment to each Shareholder as such Shareholder
          may reasonably request.

     (vi)       make its best efforts to prevent the issuance of any Order
     suspending the effectiveness of the registration statement and, if such an
     Order is issued, to obtain the withdrawal of such Order at the earliest
     possible time;


     (vii)      cause all of the Registrable Securities covered by the
     registration statement to be listed on each securities exchange, or
     designated for inclusion in each automated interdealer quotation system, on
     which the Common Stock is listed or included.

     (viii)     JAKKS shall comply with all applicable laws related to a
     Registration Statement and offering and sale of securities and all
     applicable rules and regulations of governmental authorities in connection
     therewith (including, without limitation, the Securities Act and the
     Exchange Act, and the rules and regulations promulgated by the Commission);
     and

     (ix)       JAKKS shall take all such other actions as any Shareholder or
     the underwriters, if any, reasonably request in order to expedite or
     facilitate the disposition of such Registrable Securities.

2.5  Limitations on Registrations. JAKKS may delay the filing, or the making of
a request for the acceleration of effectiveness, of a registration statement
pursuant to this Section 2 or withdraw or suspend the effectiveness of a
registration statement covering the Registrable Securities that has become
effective if in the good faith and reasonable judgment of JAKKS' board of
directors, JAKKS would be required to include in such registration statement or
the prospectus included therein (or in an amendment or supplement thereto)
material information that at that time could not be publicly disclosed without
materially interfering with any financing, acquisition, corporate reorganization
or other material development or transaction then pending or as to which JAKKS
has taken substantive steps to structure or negotiate; provided that the
duration of any such delay, suspension or withdrawal shall not exceed 90 days
from the date that JAKKS' board of directors commences or becomes aware of such
transaction or development and that JAKKS shall not exercise its right to cause
such delay, suspension or withdrawal on one or more occasions if, as a result
thereof, the aggregate duration of all such delays, suspensions or withdrawals
would exceed 90 days within any rolling 12-month period during the term of this
Agreement; and, in case of any such delay, suspension or withdrawal, JAKKS shall
make such filing or amendment as is reasonably necessary to complete, restore or
reinstate such registration statement no later than the



                                       5
<PAGE>

earlier of (i) the earliest date on which the conditions leading to such delay,
suspension or withdrawal no longer apply and (ii) the end of such 90 day period.

2.6  Shareholders' Obligations. It is a condition precedent to JAKKS' obligation
to register any Registrable Securities pursuant hereto that (a) the Shareholders
cooperate with JAKKS in the preparation of the Registration Statement (or any
amendment thereto), including providing any information with respect to the
Shareholders required to be included therein, and (b) in the case of an
incidental registration of Common Stock or other equity securities of JAKKS for
sale in an underwritten public offering, each Shareholder who participates in
such registration agrees to sell his or her Registrable Securities to the
underwriters at the same price and on substantially the same terms and
conditions as apply to the other securities included in such registration and
that they execute the underwriting agreement, custody agreement and related
documents that apply to all the securities to be offered under such
registration.

3.   Preparation; Reasonable Investigation.

3.1  In connection with the preparation and filing of the registration statement
and any amendments thereto and any Blue Sky Filing, JAKKS will give the Agent
and its counsel and accountant the opportunity to review, in each case, a
reasonable time prior to their filing, the registration statement, each
prospectus included therein or filed with the Commission, each document
incorporated by reference therein and each amendment thereof or supplement
thereto and any Blue Sky Filing in order to verify the accuracy of any factual
information concerning the Kidz Biz Companies or the Shareholders. JAKKS will
make available for inspection by the Agent, any underwriter participating in any
disposition pursuant to such registration statement and any attorney, accountant
or other agent retained by the Agent or any such underwriter (collectively, the
"Inspectors"), all financial and other records, pertinent corporate documents
and properties of JAKKS (collectively, the "Records") as shall be reasonably
necessary to enable them to exercise their due diligence responsibility, and
cause JAKKS's officers, directors and employees to supply all information
reasonably requested by any such Inspector in connection with such registration
statement and permit the Inspectors to participate in the preparation of such
registration statement and any prospectus contained therein and any amendment
thereof or supplement thereto. Records which JAKKS determines, in good faith, to
be confidential and which it notifies the Inspectors are confidential shall not
be disclosed by the Inspectors unless (i) the disclosure of such Records is
necessary to avoid or correct a misstatement or omission in the registration
statement, (ii) the release of such Records is ordered pursuant to a subpoena or
other Order from a court of competent jurisdiction, or (iii) the information in
such Records has been made generally available to the public. The seller of
Registrable Securities agrees by acquisition of such Registrable Securities that
it will, upon learning that disclosure of such Records is sought in a court of
competent jurisdiction, give notice to JAKKS and allow JAKKS, at JAKKS's
expense, to undertake appropriate action to prevent or limit disclosure of the
Records deemed confidential. JAKKS shall pay for all registration and filing
fees, printing expenses and fees and disbursements of JAKKS's counsel and one
counsel for the Shareholders and the Agent and JAKKS's Accountants in connection
with the preparation, review and filing of the registration statement or any
Blue Sky Filing pursuant to this Agreement; provided, however, that the Agent on
behalf of the Shareholders shall pay underwriting discounts and commissions
applicable to the sale of the Registrable Securities.



                                       6
<PAGE>

4.   Application to Subsequent Holders.

4.1  The provisions of this Agreement shall inure to the benefit of and be
binding upon any holder of Registrable Securities; provided that all such
holders shall be deemed to be represented by and act through the Agent (or, if
he shall die, resign or otherwise cease so to act, a successor designated by the
Agent in a written notice given to JAKKS, or if the Agent shall not so designate
a successor, a successor designated by the holders of a majority of the
Registrable Securities then outstanding in a written notice given to JAKKS, the
designation of such successor to be effective upon actual receipt of such notice
by JAKKS) and any notice or other documents required or permitted to be given or
delivered pursuant to the provisions of this Agreement to or by the Shareholders
shall be deemed to be duly so given or delivered if given to or by the Agent (or
such successor) in accordance with Section 8.2, and any right of the holders of
Registrable Securities, including in connection with the preparation of any
documents or any investigation pursuant to Agreement relating to any
registration, shall be exercised or effected by or through the Agent (or such
successor).

5.   The Agent.

5.1  Any Party hereto may rely upon any Notice given by the Agent on behalf of
any Shareholder with respect to any election, determination or other action to
be made or taken by him hereunder as the act and deed of such Shareholder. It
shall be sufficient to deliver to the Agent at his address set forth in Section
8.2 below any Notice or other document to be delivered hereunder to any
Shareholder and it shall be the sole responsibility of the Agent to deliver any
Notice or other document so delivered to him in such manner as he and the
Shareholders, or any of them, may agree.

5.2  Each election, determination or other action of the Agent in connection
with this Agreement shall be binding upon all of the Shareholders, and no
Shareholder shall have any right to object, dissent from, or protest or
otherwise contest the same or take any separate action relating to the same.

5.3  Any delivery to be made hereunder to or for any Shareholder that is made to
the Agent as herein provided shall constitute, as between JAKKS and the
Shareholders, delivery in full of the item to be delivered. It shall be the sole
responsibility of the Agent to hold for and disburse to the Shareholders and any
items delivered to the Agent pursuant hereto.

6.   Reports under the Exchange Act. With a view to making available to the
Shareholders the benefits of Rule 144 promulgated under the Securities Act or
any other similar rule or regulation of the Commission that may at any time
permit the Shareholders to sell securities of JAKKS to the public without
registration ("Rule 144"), JAKKS agrees to, so long as such Shareholder holds or
beneficially owns Registrable Securities:

     (i)        File with the Commission in a timely manner and make and keep
     available all reports and other documents required of JAKKS under the
     Securities Act and the Exchange Act so long as JAKKS remains subject to
     such requirements and the filing and availability of such reports and other
     documents is required for the applicable provisions of Rule 144; and

     (ii)       Furnish to each Shareholder promptly upon request, (i) a written
     statement by JAKKS that it has complied with the reporting requirements of
     Rule 144, the Securities Act and the Exchange Act, (ii) a copy of the most
     recent annual or quarterly report of JAKKS and such other reports and
     documents so filed by JAKKS, and (iii) such other information as may be
     reasonably



                                       7
<PAGE>

     requested to permit the Shareholders to sell such securities pursuant to
     Rule 144 without registration.

7.   Indemnification.

7.1  Shareholders' Indemnity. Each Shareholder, severally but not jointly, shall
indemnify and defend JAKKS against, and hold it harmless from, any loss,
liability, obligation, damage or expense (including reasonable attorneys' fees
and disbursements) which it may suffer or incur incidental to any claim or any
Proceeding against it arising out of, based upon or resulting from an untrue
statement or alleged untrue statement of a material fact contained in, or
omission or alleged omission of a material fact from, the registration
statement, any preliminary prospectus or final prospectus contained therein, or
any amendment or supplement thereto, or any document incidental to the
registration or qualification of the JAKKS Shares that is required to be stated
therein or necessary to make the statements therein not misleading or, with
respect to any prospectus, necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading which statement or
omission is made in reliance upon and in conformity with written information
furnished to JAKKS by that Shareholder solely for use in the preparation thereof
("Shareholders' Securities Claims"). provided, however, that no Shareholder
shall be liable in any such case to the extent that such Securities Claims arise
out of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in, or omission or alleged omission of a material fact
from, the registration statement, such preliminary prospectus or such prospectus
or such amendment or supplement or any document incident to the registration or
qualification of the Registrable Securities in reliance upon and in conformity
with written information furnished to it by JAKKS solely for use in the
preparation thereof.

7.2  JAKKS' Indemnity. JAKKS shall indemnify and defend each Shareholder and
each person who participates as a placement or sales agent or as an underwriter
(within the meaning of the Securities Act) in any offering of the Registrable
Securities against, and hold each of them harmless from, any loss, liability,
obligation, damage or expense (including reasonable attorneys' fees and
disbursements) which any of them may suffer or incur incidental to any claim or
any Proceeding against any of them arising out of, based upon or resulting from
an untrue statement or alleged untrue statement of a material fact contained in
the registration statement, any preliminary prospectus or final prospectus
contained therein, any document incorporated by reference therein or any
amendment or supplement thereto, or any document prepared and/or furnished by
JAKKS or its Affiliates incident to the registration or qualification of the
Registrable Securities, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading or, with respect to
any prospectus, necessary to make the statements therein in light of the
circumstances under which they were made, not misleading, or any violation by
JAKKS or its Affiliates of the Securities Act or Blue Sky Laws applicable to
them and relating to action or inaction required of JAKKS or its Affiliates in
connection with such registration or qualification under such Blue Sky Laws
("JAKKS' Securities Claims"); provided, however, that JAKKS shall not be liable
in any such case to the extent that such Securities Claims arise out of or are
based upon an untrue statement or alleged untrue statement of a material fact
contained in, or omission or alleged omission of a material fact from, the
registration statement, such preliminary prospectus or such prospectus or such
amendment or supplement or any document incident to the registration or
qualification of the Registrable Securities in reliance upon and in conformity
with written information furnished to it by that Shareholder solely for use in
the preparation thereof.



                                       8
<PAGE>

7.3  Claims Procedure. Promptly after Notice to an indemnified party of any
claim or the commencement of any Proceeding by a third party involving any loss,
liability, obligation, damage or expense referred to in Section 7.1 or 7.2, such
indemnified party shall, if a claim for indemnification in respect thereof is to
be made against an indemnifying party, give written Notice to the latter of the
commencement of such claim or Proceeding, setting forth in reasonable detail the
nature thereof and the basis upon which such party seeks indemnification
hereunder; provided that the failure of any indemnified party to give such
Notice shall not relieve the indemnifying party of its obligations under such
Section, except to the extent that the indemnifying party is actually prejudiced
by the failure to give such Notice. In case any such Proceeding is brought
against an indemnified party, and provided that proper Notice is duly given, the
indemnifying party shall assume and control the defense thereof insofar as such
Proceeding involves any loss, liability, obligation, damage or expense in
respect of which indemnification may be sought hereunder, with counsel selected
by the indemnifying party (and reasonably satisfactory to such indemnified
party), and, after Notice from the indemnifying party to such indemnified party
of its assumption of the defense thereof, the indemnifying party shall not be
liable to such indemnified party for any legal or other expenses subsequently
incurred by the indemnified party in connection with the defense thereof (but
the indemnified party shall have the right, but not the obligation, to
participate at its own cost and expense in such defense by counsel of its own
choice) or for any amounts paid or foregone by the indemnified party as a result
of the settlement or compromise thereof (without the written consent of the
indemnifying party), except that, if both the indemnifying party and the
indemnified party are named as parties or subject to such Proceeding and either
such party reasonably determines with advice of counsel that a material conflict
of interest between such parties may exist in respect of such Proceeding, the
indemnifying party may decline to assume the defense on behalf of the
indemnified party or the indemnified party may retain the defense on its own
behalf, and, in either such case, after Notice to such effect is duly given
hereunder to the other party, the indemnifying party shall be relieved of its
obligation to assume the defense on behalf of the indemnified party, but shall
be required to pay any legal or other expenses, including without limitation
reasonable attorneys' fees and disbursements incurred by the indemnified party
in such defense; provided, however, that the indemnifying party shall not be
liable for such expenses on account of more than one separate firm of attorneys
(and, if necessary, local counsel) at any time representing such indemnified
party in connection with any Proceeding or separate Proceedings in the same
jurisdiction arising out of or based upon substantially the same allegations or
circumstances. If the indemnifying party shall assume the defense of any such
Proceeding, the indemnified party shall cooperate fully with the indemnifying
party and shall appear and give testimony, produce documents and other tangible
evidence, allow the indemnifying party access to the books and records of the
indemnified party and otherwise assist the indemnifying party in conducting such
defense. No indemnifying party shall, without the consent of the indemnified
party, which consent shall not be unreasonably withheld, consent to entry of any
judgment or enter into any settlement or compromise which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release from all liability in respect of such claim or
Proceeding. Provided that proper Notice is duly given, if the indemnifying party
shall fail promptly and diligently to assume the defense thereof, if and in the
manner required hereunder, the indemnified party may respond to, contest and
defend against such Proceeding (but the indemnifying party shall have the right
to participate at its own cost and expense in such defense by counsel of its own
choice) and may make in good faith any compromise or settlement with respect
thereto, and recover the entire cost and expense thereof, including, without
limitation, reasonable attorneys' fees and disbursements and all amounts paid or
foregone as a result of such Proceeding, or the settlement or compromise
thereof, from the indemnifying party. Any indemnification required to be made
hereunder shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills or invoices are
received or loss, liability, obligation, damage or expense is actually suffered
or incurred.


                                       9
<PAGE>

7.4  Limitations.

     (i)  Any other provision hereof notwithstanding:

          (1)  If JAKKS is entitled to receive indemnification from the
          Shareholders pursuant to Section 7.1, JAKKS may, upon thirty (30) days
          prior written Notice to the Shareholders, cause the amount thereof to
          be offset and retained by JAKKS HK from any payment of the Earn-Out
          (as such term is defined in the Stock Purchase Agreement) otherwise
          payable to the Shareholders thereunder;

          (2)  no indemnified party shall be entitled to any indemnification
          under this Agreement to the extent that it actually receives or is
          entitled to receive any amount in respect of any loss, liability,
          obligation, damage or expense from other sources, including without
          limitation insurance or third-party indemnity; provided that such
          indemnified party shall not be required to commence any Proceeding to
          collect any such amount.

(b)  The indemnification obligations under this Agreement are independent of any
other indemnification obligations that any of the parties hereto may have to one
another under any other agreement between or among them, and, in particular,
none of the limitations upon the indemnification obligations of the parties to
the Stock Purchase Agreement shall apply to the indemnification obligations of
the parties under this Agreement.


7.5  Contribution. Each Shareholder and JAKKS agree that if, for any reason, the
indemnification provisions contemplated by Sections 7.1 or 7.2 hereof are
unavailable to or are insufficient to hold harmless an indemnified party in
respect of any losses (or actions or proceedings in respect thereof) referred to
therein, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of such losses (or actions or
proceedings in respect thereof) in such proportion as is appropriate to reflect
the relative fault of, and benefits derived by, the indemnifying party and the
indemnified party, as well as any other relevant equitable considerations. The
relative fault of such indemnifying party and indemnified party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of material fact or omission alleged omission to state a
material fact relates to information supplied by such indemnifying party or by
such indemnified party, and the parties' relative intent, knowledge access to
information and opportunity to correct or prevent such statement or omission.
The parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 7.5 were determined (i) by pro rate allocation (even if
the Shareholder or any agents for, or underwriters of, the Registrable
Securities, or all of them, were treated as one entity for such purpose); or
(ii) by any other method of allocation which does not take account of the
equitable considerations referred to in this Section 7.5. The amount paid or
payable by an indemnified party as a result of losses (or actions or proceedings
in respect thereof) referred to above shall be deemed to include (subject to the
limitations set forth in Section 7.3 hereof) any legal or other fees or expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action, proceeding or claim. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.

7.6  Extent of Indemnification. The obligations of the Company under this
Section 7 shall be in addition to any liability that it may otherwise have and
shall extend, upon the same terms and conditions,



                                       10
<PAGE>

to each agent and underwriter of the Registrable Securities and each person, if
any, who controls such agent or underwriter with the meaning of the Securities
Act.

8.   Miscellaneous.

8.1  Fees and Expenses. Except as otherwise specified in this Agreement, each
party hereto shall bear such fees and expenses as may be incurred by it in
connection with this Agreement.

8.2  Notices. Any Notice or demand required or permitted to be given or made
hereunder to or upon any Party hereto shall be deemed to have been duly given or
made for all purposes if in writing and (i) if sent by messenger or Federal
Express or internationally recognized courier service, or by priority overnight
delivery between any two points within the U.S. or any two points within the
U.K., on the business day next following the date such Notice or demand was
delivered, or (ii) if sent by priority overnight delivery between any point
within the U.S. and any point outside of the U.S., or between any point within
the U.K. and any point outside of the U.K., or between any two points outside of
the U.S. or the U.K., three (3) business days next following the date such
Notice or demand was delivered; or (iii) if sent by mail, three (3) business
days after deposit in the mails, if mailed by certified or registered mail
(return receipt requested) between any two points within the U.S. or any two
points within the U.K., and seven (7) business days if mailed by certified or
registered mail (return receipt requested) between any point within the U.S. and
any point outside of the U.S., or between any point within the U.K. and any
point outside of the U.K., or between any two points outside of the U.S. or the
U.K., or (iv) if sent by telegram, telecopy (confirmed to the sender), telex or
similar electronic means, the business day next following the date such notice
or demand was so transmitted, provided that a written copy thereof is sent on
the same day by postage-paid first-class mail, to such Party at the following
address:

                             if to JAKKS Pacific:

                             JAKKS Pacific, Inc.

                             22619 Pacific Coast Highway

                             Malibu, California 90265

                             Attn:  President

                             Fax:   (310) 317-8527




                                       11
<PAGE>

        and to:              Feder, Kaszovitz, Isaacson,

                             Weber, Skala, Bass & Rhine LLP

                             750 Lexington Avenue

                             New York, New York 10022-1200 U.S.

                             Attn:  Geoffrey A. Bass, Esq.

                             Fax:   (212) 888-7776


to David Lipman or
                             Marilyn Lipman  at:

                             David S. Lipman

                             Castilian House

                             The Ridge

                             Epsom, Surrey KT18 1BS

                             United Kingdom

                             Fax:



                             to John Nimmo:

                             John Nimmo

                             Morwell

                             5 Grays Lane

                             Ashtead, Surrey KT21 1BS

                             United Kingdom

                             Fax:



                                       12
<PAGE>

                             with a copy to:   Altheimer & Gray

                             10 South Wacker Drive

                             Chicago, Illinois 60606-7482 U.S.

                             Attn: Jonathan Baird, Esq

                             Fax: 312-715-4800


and to:                      Altheimer & Gray

                             7 Bishopsgate

                             London EC2N 3AR United Kingdom

                             Fax: 020-7786-0000

                             Attn: Dean Harper, Esq.


or such other address as any Party hereto may at any time, or from time to time,
direct by Notice given to the other Parties in accordance with this Section.
Except as otherwise expressly provided herein, the date of giving or making of
any such Notice or demand shall be, in the case of clause (a) (i), the date of
the receipt; in the case of clause (a) (ii), three business days after such
Notice or demand is sent; and, in the case of clause (b), the business day next
following the date such Notice or demand is sent.

8.3  Amendment. Except as otherwise expressly provided herein, no amendment of
this Agreement shall be valid or effective, unless in writing and signed by or
on behalf of the parties hereto.

8.4  Waiver. No course of dealing or omission or delay on the part of any party
hereto in asserting or exercising any right hereunder shall constitute or
operate as a waiver of any such right. No waiver of any provision hereof shall
be effective, unless in writing and signed by or on behalf of the party to be
charged therewith. No waiver shall be deemed a continuing waiver or waiver in
respect of any other or subsequent breach or default, unless expressly so stated
in writing.

8.5  Governing Law. This Agreement shall be governed by, and interpreted and
enforced in accordance with, the laws of the State of New York without regard to
principles of choice of law or conflict of laws. For the purpose of enforcing
the provisions of Section 8.6 of this Agreement and any other remedy available
to a Party under this Agreement which is outside of the jurisdiction of the
arbitrators referred to in Section 8.6, each Party to this Agreement submits to
the jurisdiction of the courts of the State of New York, located in New York
County, New York, United States of America, and to the jurisdiction of the
United States District Court for the Southern District of New York, New York,
New York, United States of America with respect to any matter arising out of
this Agreement, waives any objection to venue in the Counties of New York, State
of New York, or such District, and agrees that

                                       13
<PAGE>

service of any summons, complaint, Notice or other process relating to such
Proceeding may be effected in the manner provided by Section 8.2.

8.6  Arbitration. Any claim, dispute or controversy between or among any of the
Parties hereto shall be submitted to arbitration in New York, New York in
accordance with the then current Commercial Arbitration Rules of the American
Arbitration Association before a panel of three arbitrators. JAKKS, on the one
hand, and the Shareholders shall each pay one-half of any filing fees or other
administrative costs to be paid in advance of or during such Proceeding. The
arbitrators shall render a reasoned decision with respect to such Proceeding
which shall include, in addition to the imposition of monetary damages or any
other remedy or relief available hereunder, an allocation of the costs thereof.
The decision of the arbitrators shall be final and binding upon the parties to
such Proceeding, and judgment thereon may be entered in any court of competent
jurisdiction. The arbitrators shall have no power to change any of the
provisions of this Agreement in any respect, nor shall they have any power to
make an award of reformation, and the jurisdiction of the arbitrators is
expressly limited accordingly. No Party hereto shall be liable for punitive
damages, unless such Party is found to have committed fraud or willful
malfeasance against another Party hereto. At least one of the arbitrators shall
be an attorney admitted to the practice of law for at least fifteen (15) years
with substantial experience in business and commercial transactions.

8.7  Severability. The provisions hereof are severable and in the event that any
provision of this Agreement shall be determined to be invalid or unenforceable
in any respect by a court of competent jurisdiction, the remaining provisions
hereof shall not be affected, but shall, subject to the discretion of such
court, remain in full force and effect, and any invalid or unenforceable
provision shall be deemed, without further action on the part of the parties
hereto, amended and limited to the extent necessary to render the same valid and
enforceable.

8.8  Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original and which together shall constitute one and the same
agreement.

8.9  Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns. This Agreement is not intended, and shall not be deemed, to create or
confer any right or interest for the benefit of any Person not a party hereto.

8.10 Titles and Captions. The titles and captions of the Articles and Sections
of this Agreement are for convenience of reference only and do not in any way
define or interpret the intent of the parties or modify or otherwise affect any
of the provisions hereof.

8.11 Grammatical Conventions. Whenever the context so requires, each pronoun or
verb used herein shall be construed in the singular or the plural sense and each
capitalized term defined herein and each pronoun used herein shall be construed
in the masculine, feminine or neuter sense.

8.12 References. The terms "herein," "hereto," "hereof," "hereby" and
"hereunder," and other terms of similar import, refer to this Agreement as a
whole, and not to any Article, Section or other part hereof. Each party hereto
acknowledges that it has participated, with the advice of counsel, in the
preparation of this Agreement. No party hereto is entitled to any presumption
with respect to the interpretation of any provision hereof or the resolution of
any alleged ambiguity herein based on any claim that any other party hereto
drafted or controlled the drafting of this Agreement.



                                       14
<PAGE>

8.13 Entire Agreement. This Agreement embodies the entire agreement of the
parties hereto with respect to the subject matter hereof and supersedes all
prior agreements, commitments or arrangements relating thereto.


     IN WITNESS WHEREOF, JAKKS PACIFIC, INC., by its duly authorized officer,
and the other parties hereto have duly executed this Agreement as of the date
set forth in the Preamble hereto.




JAKKS PACIFIC, INC.




By: /s/ STEPHEN G. BERMAN
   -------------------------------
   Name:  Stephen G. Berman
   Title: President and COO



/s/ DAVID S. LIPMAN
---------------------------------
David S. Lipman



/s/ JOHN NIMMO
---------------------------------
John Nimmo


/s/ MARILYN LIPMAN
--------------------------------
Marilyn Lipman



                                       15