"We felt it was in the best interest of the Pokemon property for Pokemon USA, Inc., to assume all aspects of licensing," said Akira Chiba, President of Pokemon USA, Inc. "This was a brand management decision. We would like to thank 4Kids for all of its great work over the last eight years in helping to establish Pokemon as one of the leading children's brands in the world."

"4Kids has had a successful eight-year exclusive relationship with the Pokemon property that will be expiring at year end," said Alfred R. Kahn, Chairman and CEO of 4Kids Entertainment. "Over the next month, 4Kids will assist Pokemon USA, Inc., in its transition to in-house representation. We wish Pokemon USA much success going forward."

Under the terms of the expiring Pokemon USA, Inc. - 4Kids representation agreement, 4Kids will continue to receive commissions for the next several years on payments made under existing Pokemon license agreements whose term expires after December 31, 2005. It is expected that commissions earned by 4Kids from the Pokemon property will decline over the course of the next several years. 4Kids will also continue next year to produce the current eighth season of Pokemon television episodes.