8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report: November 14, 2002

(Date of earliest event reported)

ACTION PRODUCTS INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

Florida	000-13118	59-2095427
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(IRS Employer Identification No.)

390 N. ORANGE AVENUE, SUITE 2185

ORLANDO, FLORIDA 32801

(Address of principal executive offices, zip code)

(407) 481-8007

(Registrant’s telephone number, including area code)

Item 5. Other Events.

         The NASDAQ Listing Qualifications Department (“the Staff”) has notified the Company that it is not in compliance with the requirements of NASD Marketplace Rule 4310(c)(2)(B) for continued listing of its securities on Nasdaq’s SmallCap Market. This rule requires the Company to have a minimum of $2,000,000 in net tangible assets or $2,500,000 in stockholders’ equity or a market value of listed securities of $35,000,000 or $500,000 of net income from continuing operations for the most recent completed fiscal year (or two of the three most recently completed fiscal years). The Company has historically satisfied its requirements under this rule by meeting the minimum value for net tangible assets or stockholders’ equity. Based on the Company’s last filed quarterly report on Form 10-QSB for the period ended June 30, 2002, the Company’s net tangible assets and stockholders equity were $1,630,400 and $2,412,800, respectively. Consequently, Action Products’ common stock is subject to delisting from The NASDAQ SmallCap Market. Pursuant to NASD Marketplace Rules, the Company intends to appeal the Staff’s determination before a NASDAQ Listing Qualifications Panel (“the Panel”). The hearing before the Panel has been scheduled for November 22, 2002. The Company’s hearing request automatically delays the delisting pending the Panel’s final review and determination of the appeal. Until the Panel’s ultimate determination, Action Products’ common shares will continue to be traded on the NASDAQ SmallCap Market. While there are no guarantees that the Company’s appeal will be successful, the Company believes that based upon the reductions in its operating costs, totaling over $500,000 annually, that have been implemented in the first six months of 2002, the financing options it is currently pursuing, potential asset purchases in exchange for common stock and the favorable sales impact of new product introductions, that the Company will be able to set forth a satisfactory plan to the Panel to come back into compliance with the NASD Marketplace Rules and to maintain its listing on Nasdaq’s SmallCap Market.

         If the Panel determines that the foregoing is not sufficient to permit the Company to maintain its continued listing requirements, the inclusion of the Company in the Nasdaq SmallCap Market will be terminated and trading in the Company’s securities would thereafter be conducted in the non-Nasdaq over-the-counter market. Such delisting could cause the Company’s shareholders to find it more difficult to dispose of, or to obtain accurate quotations as to the market value of the Company’s securities. For the Company to be re-listed on the Nasdaq SmallCap Market, it will be required to meet that market’s initial listing requirements, among which are the following: (a) $4 million in net tangible assets, or $50 million market capitalization, or $750,000 of net income in latest fiscal year or 2 of last 3 fiscal years); (b) a public float of at least 1,000,000 shares (exclusive of officers, directors and 10% holders) with a market value of at least $5 million; (c) minimum bid price of $4 per share; (d) a minimum of three market makers; (e) a minimum of 300 shareholders.

         If the Company’s common stock is delisted from Nasdaq, its common stock may become subject to the penny stock rules. Broker-dealer practices in connection with transactions in “penny stocks” are regulated by certain rules adopted by the Securities and Exchange Commission. Penny stocks generally are equity securities with a price of less than $5.00 other than securities registered on certain national securities exchanges or quoted on Nasdaq provided that current price and volume information with respect to transactions in such securities is

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provided by the exchange or system. The rules require that, prior to a transaction in a penny stock not otherwise exempt from the rules, the broker-dealer must

• deliver a standardized risk disclosure document that provides information about penny stocks and the risks in the penny stock market,

• provide the customer with current bid and offer quotations for the penny stock,

• disclose the compensation of the broker-dealer and its salesperson in connection with the transaction,

• provide the customer monthly account statements showing the market value of each penny stock held in the customer’s account, and

• make a special written determination that the penny stock is a suitable investment for the customer and receive the customer’s written agreement to the transaction.

         These disclosure requirements may have the effect of reducing the liquidity of penny stocks. If the Company’s securities are subject to the penny stock rules, holders of the Company’s securities may find it more difficult to sell their shares of the Company’s common stock.

         The press release issued by the Company in connection with the NASDAQ delisting notice is attached hereto as Exhibit 99.1.

Item 7. Financial Statements and Exhibits

(c) Exhibits

Exhibit No.	Item
99.1	Press Release of the Company regarding the NASDAQ delisting notice.

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SIGNATURES

         Pursuant to the requirement of the Securities Exchange Act of 1934, the Registrant has duly caused this amended report to be signed on its behalf by the undersigned hereunto duly authorized.

	ACTION PRODUCTS INTERNATIONAL, INC
Date: November 14, 2002		By:  /s/Robert L. Burrows
		Robert L. Burrows
		Chief Financial Officer

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EXHIBIT INDEX

Exhibit No.	Item
99.1	Press Release of the Registrant regarding the NASDAQ delisting notice.

- 5 - EX-99.1 3 g79373exv99w1.txt PRESS RELEASE EXHIBIT 99.1 [NEWS RELEASE] FOR: ACTION PRODUCTS INTERNATIONAL, INC. CONTACTS: Ronald Kaplan, CEO Robert Burrows, CFO (407) 481-8007 investor@apii.com Greg Zesinger (Media Contact) (407) 481-8007 x 722 gzesinger@apii.com ACTION PRODUCTS TO APPEAL NASDAQ DELISTING NOTIFICATION ORLANDO, FL -- October 21, 2002 -- (PR Newswire) - - Action Products International Inc. (Nasdaq-SC: APII), today announced that the NASDAQ Listing Qualifications Department ("the Staff") has notified the Company that it is not in compliance with the requirements of NASD Marketplace Rule 4310(c)(2)(B) for continued listing of its securities on Nasdaq's SmallCap Market. This rule requires the Company to have a minimum of $2,000,000 in net tangible assets or $2,500,000 in stockholders' equity or a market value of listed securities of $35,000,000 or $500,000 of net income from continuing operations for the most recent completed fiscal year (or two of the three most recently completed fiscal years). The Company has historically satisfied its requirements under this rule by meeting the minimum value for net tangible assets or stockholders' equity. Based on the Company's last filed quarterly report on Form 10-QSB for the period ended June 30, 2002, the Company's net tangible assets and stockholders equity were $1,630,400 and $2,412,800, respectively. Consequently, Action Products' common stock is subject to delisting from The NASDAQ SmallCap Market. Pursuant to NASD Marketplace Rules, the Company intends to appeal the Staff's determination before a NASDAQ Listing Qualifications Panel ("the Panel"). The hearing is required to take place within 45 days of the Company's request. The Company's hearing request automatically delays the delisting pending the Panel's final review and determination of the appeal. Until the Panel's ultimate determination, Action Products' common shares will continue to be traded on the NASDAQ SmallCap Market. While there are no guarantees that the Company's appeal will be successful, the Company believes that based upon the reductions in its expenses and operating costs that have been implemented this year, the financing options it is currently pursuing and the rapid approach of the biggest retail period of the year (i.e., the Christmas season), that the Company will be able to set forth a satisfactory plan to the Panel to come back into compliance with the NASD Marketplace Rules and to maintain its listing on Nasdaq's SmallCap Market. ABOUT ACTION PRODUCTS INTERNATIONAL, INC. Action Products International, Inc. is a toy manufacturer emphasizing educational and non-violent products, including Jay Jay The Jet Plane Wooden Adventure System(TM), I Dig Dinosaurs(R) and I Dig Treasures(R) excavation activity kits, Space Voyagers(R) ("The most authentic Space Toys on Earth"), Climb@Tron(TM) window-climbing robots, Thomas & Friends(TM) Creative Play arts and crafts kits, Play and Store(TM) themed playsets and Drop Zone Extreme(TM) parachute toys. Its products are marketed and sold to toy stores, specialty retailers, Internet retailers, museums, zoos, theme parks, attractions, catalog companies, and educational markets in the United States and worldwide. Additional information on Action Products and its toys is available via email at marketing@apii.com or by visiting the World Wide Web at www.apii.com For additional information, please contact: Ronald Kaplan, CEO, or Robert Burrows, CFO at (407) 481-8007 or RJ Falkner & Company, Investor Relations Counsel at (800) 377-9893 or via e-mail at info@rjfalkner.com # # # NOTE: Any statements that are not historical facts contained in this release are forward-looking statements. It is possible that the assumptions made by management for purposes of such statements may not materialize. Actual results may differ materially from those projected or implied in any forward-looking statements. Such statements may involve risks and uncertainties, including but not limited to those relating to product demand, pricing, market acceptance, the effect of economic conditions, and intellectual property rights and the outcome of competitive products, risks in product development, the results of financing effort, the ability to complete transactions, and other risks identified in this release and the Company's Securities and Exchange Commission filings. This press release and prior releases are available at www.apii.com. -----END PRIVACY-ENHANCED MESSAGE-----

EX-99.1

                                                                    EXHIBIT 99.1

                                 [NEWS RELEASE]

FOR:                       ACTION PRODUCTS INTERNATIONAL, INC.

CONTACTS:                  Ronald Kaplan, CEO
                           Robert Burrows, CFO
                           (407) 481-8007
                           investor@apii.com
                           Greg Zesinger (Media Contact)
                           (407) 481-8007 x 722
                           gzesinger@apii.com

             ACTION PRODUCTS TO APPEAL NASDAQ DELISTING NOTIFICATION

ORLANDO, FL -- October 21, 2002 -- (PR Newswire) - - Action Products
International Inc. (Nasdaq-SC: APII), today announced that the NASDAQ Listing
Qualifications Department ("the Staff") has notified the Company that it is not
in compliance with the requirements of NASD Marketplace Rule 4310(c)(2)(B) for
continued listing of its securities on Nasdaq's SmallCap Market. This rule
requires the Company to have a minimum of $2,000,000 in net tangible assets or
$2,500,000 in stockholders' equity or a market value of listed securities of
$35,000,000 or $500,000 of net income from continuing operations for the most
recent completed fiscal year (or two of the three most recently completed fiscal
years). The Company has historically satisfied its requirements under this rule
by meeting the minimum value for net tangible assets or stockholders' equity.
Based on the Company's last filed quarterly report on Form 10-QSB for the period
ended June 30, 2002, the Company's net tangible assets and stockholders equity
were $1,630,400 and $2,412,800, respectively. Consequently, Action Products'
common stock is subject to delisting from The NASDAQ SmallCap Market.

Pursuant to NASD Marketplace Rules, the Company intends to appeal the Staff's
determination before a NASDAQ Listing Qualifications Panel ("the Panel"). The
hearing is required to take place within 45 days of the Company's request. The
Company's hearing request automatically delays the delisting pending the Panel's
final review and determination of the appeal. Until the Panel's ultimate
determination, Action Products' common shares will continue to be traded on the
NASDAQ SmallCap Market.

While there are no guarantees that the Company's appeal will be successful, the
Company believes that based upon the reductions in its expenses and operating
costs that have been implemented this year, the financing options it is
currently pursuing and the rapid approach of the biggest retail period of the
year (i.e., the Christmas season), that the Company will be able to

set forth a satisfactory plan to the Panel to come back into compliance with the
NASD Marketplace Rules and to maintain its listing on Nasdaq's SmallCap Market.

ABOUT ACTION PRODUCTS INTERNATIONAL, INC.

Action Products International, Inc. is a toy manufacturer emphasizing
educational and non-violent products, including Jay Jay The Jet Plane Wooden
Adventure System(TM), I Dig Dinosaurs(R) and I Dig Treasures(R) excavation
activity kits, Space Voyagers(R) ("The most authentic Space Toys on Earth"),
Climb@Tron(TM) window-climbing robots, Thomas & Friends(TM) Creative Play arts
and crafts kits, Play and Store(TM) themed playsets and Drop Zone Extreme(TM)
parachute toys. Its products are marketed and sold to toy stores, specialty
retailers, Internet retailers, museums, zoos, theme parks, attractions, catalog
companies, and educational markets in the United States and worldwide.

Additional information on Action Products and its toys is available via email at
marketing@apii.com or by visiting the World Wide Web at www.apii.com

                   For additional information, please contact:

         Ronald Kaplan, CEO, or Robert Burrows, CFO at (407) 481-8007

                                       or

RJ Falkner & Company, Investor Relations Counsel at (800) 377-9893 or via e-mail
at info@rjfalkner.com

                                      # # #

 NOTE: Any statements that are not historical facts contained in this release
are forward-looking statements. It is possible that the assumptions made by
management for purposes of such statements may not materialize. Actual results
may differ materially from those projected or implied in any forward-looking
statements. Such statements may involve risks and uncertainties, including but
not limited to those relating to product demand, pricing, market acceptance, the
effect of economic conditions, and intellectual property rights and the outcome
of competitive products, risks in product development, the results of financing
effort, the ability to complete transactions, and other risks identified in this
release and the Company's Securities and Exchange Commission filings.

This press release and prior releases are available at www.apii.com.