8-K

UNITED STATES

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 (Date of earliest event reported): February 1, 2007

Action Products International, Inc.

(Exact name of registrant as specified in its charter)

Florida	001-13118	59-2095427
(State of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

1101 N. Keller Road, Suite E

Orlando, Florida 32810

(Address of principal executive office, including zip code)

(407) 481-8007

(Telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement

On July 20, 2006, we made a distribution to our shareholders of one warrant for each common share owned on January 18, 2006, each warrant entitling the owner to purchase one common share at an exercise price of $3.25 per share until January 31, 2007 and $3.75 per share from February 1, 2007 until January 31, 2008.

As previously reported on Form 8-K filed on January 31, 2007, on January 30, 2007, our Board of Directors extended the expiration dates of the warrants such that the warrants will allow the holders to purchase one common share at an exercise price of $3.25 per share until January 31, 2008 and $3.75 per share from February 1, 2008 until January 31, 2010.

On January 31, 2007, we entered into the Second Amendment to the Warrant Agreement with our transfer and warrant agent, Registrar and Transfer Company, reflecting the extension of the warrants. A copy of the Second Amendment is attached as Exhibit 10.1 to this Current Report on Form 8-K.

Item 2.02 Results of Operations and Financial Condition

On February 1, 2007, we issued a press release describing a decline in our revenues for the twelve months ended December 31, 2006 compared to the same period ended December 31, 2005. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K.

The information in Item 2.02 of this report, including Exhibit 99.1, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. The information contained herein and in the accompanying exhibit shall not be incorporated by reference into any filing with the Securities and Exchange Commission made by the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 9.01 Financial Statements and Exhibits.

(a) Financial Statements of Business Acquired: None

(b) Pro Forma Financial Information: None

(c) Exhibits:

Exhibit No.	Description
10.1	Second Amendment to the Warrant Agreement dated January 31, 2007 by and between Action Products International, Inc. and Registrar and Transfer Company.
99.1	Press release, dated February 1, 2007, issued by Action Products International, Inc.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.

ACTION PRODUCTS INTERNATIONAL, INC.
By:	/s/ RONALD S. KAPLAN
	Ronald S. Kaplan
	Chief Executive Officer

Date: February 8, 2007

EX-10.1

Exhibit 10.1

SECOND AMENDMENT TO

WARRANT AGREEMENT

THIS SECOND AMENDMENT TO THE WARRANT AGREEMENT, dated January 31, 2007, (the “Second Amendment”) hereby amends the Warrant Agreement dated June 16, 2006, as amended by the First Amendment dated July 31, 2006, (the “Agreement”) by and between ACTION PRODUCTS INTERNATIONAL, INC., a Florida corporation (the “Company”), and REGISTRAR AND TRANSFER COMPANY, as Warrant Agent (the “Warrant Agent”) as follows:

WHEREAS, on July 20, 2006 (the “Effective Date”), the Securities and Exchange Commission declared effective a registration statement under the Securities Act of 1933, as amended, covering the offer and sale of the Common Shares issuable upon exercise of the Warrants; and

WHEREAS, the Exercise Price of the Warrants under the Agreement, prior to the First Amendment was (a) $3.25 per Common Share, if the Exercise Date is after the Effective Date but on or before the date six (6) months after the Effective Date, and (b) $3.75 per Common Share, if the Exercise Date is after the date six (6) months after the Effective Date but on or before the Expiration Date, subject to the terms and provisions of the Agreement; and

WHEREAS, the Expiration Date of the Warrants under the Agreement may be erroneously deemed to be 5:00 p.m. (Eastern time) on January 31, 2007, notwithstanding the definition of “Expiration Date” under Section 1 of the Agreement, subject to the terms and provisions of the Agreement; and

WHEREAS, the Company and the Warrant Agent clarified that the Expiration Date is July 20, 2007, the date one (1) year after the Effective Date, as set forth in Section 1, of the Agreement; and

WHEREAS, on January 30, 2007, the Board of Directors of the Company extended the expiration dates of the Warrants such that the Warrants will allow the holders thereof to purchase one common share at an exercise price of $3.25 per share until January 31, 2008 and $3.75 per share from February 1, 2008 until January 31, 2010; and

WHEREAS, the Company and the Warrant Agent desire to amend the Agreement, as amended, to reflect the extension.

NOW, THEREFORE, in consideration of the premises and the mutual agreements hereinafter set forth and for the purpose of amending the Warrants and the Agreement, the Company and the Warrant Agent hereby amend the Agreement as follows:

1. The Second “WHEREAS” clause is hereby amended as follows:

“WHEREAS, the Warrants shall be exercisable from the date the Securities and Exchange Commission declares effective a registration statement

under the Securities Act of 1933, and amended (the “1933 Act”) covering the offer and sale of the Common Shares issuable upon exercise of the Warrants (the “Effective Date”) until January 31, ^2010, unless earlier redeemed as provided herein; and”

2. The definitions of “Exercise Price” and “Expiration Date” in Section 1 are hereby amended as follows:

“Exercise Price” shall mean (a) $ 3.25 per Common Share, if the Exercise Date is after the Effective Date but on or before ^January 31, 2008, and (b) $3.75 per Common Share, if the Exercise Date is after ^January 31, 2008 but on or before the Expiration Date, subject to modification and adjustment as provided in Section 8.

“Expiration Date” shall mean, unless the Warrants are redeemed as provided in Section 9 hereof prior to such date, 5:00 p.m. (Eastern time) on ^January 31, 2010.

2. The Warrant Certificates shall be deemed to be amended such that the Expiration Date is January 31, 2010 in accordance with this Second Amendment, notwithstanding that Warrant Certificates heretofore or hereafter issued may continue to express an Expiration date of January 31, 2007.

3. This Second Amendment is made pursuant to Section 12(ii) of the Agreement not requiring approval of any holders of the Warrants.

4. Section 13 shall be amended such that any notices that shall be sent to the Company shall be copied only as follows: Tarter Krinsky & Drogin LLP, 470 Park Avenue South, 14^th Floor, New York, New York 10016, Attn: James G. Smith, Esq., Phone: (212) 481-8585.

5. All other terms, conditions and provisions of the Agreement, except as otherwise amended by this Second Amendment, shall remain in full force and effect. Capitalized terms not otherwise defined herein shall have the meanings as defined in the Agreement.

6. This Second Amendment may be executed in several counterparts, which taken together shall constitute a single document.

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IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment to be duly executed as of the date first above written.

ACTION PRODUCTS INTERNATIONAL, INC.
By:	/s/ RONALD S. KAPLAN
	Ronald S. Kaplan Chief Executive Officer

REGISTRAR AND TRANSFER COMPANY
By:	/s/ WILLIAM P. TATLER
	William P. Tatler Vice President

3

EX-99.1

Exhibit 99.1

Press Release Source: Action Products International, Inc.

Action Products International Board Extends Public Shareholder Warrants

Thursday February 1, 2:09 pm ET

ORLANDO, FL—(MARKET WIRE)—Feb 1, 2007 — Action Products International Inc. (NasdaqCM: APII—News), a consumer product company emphasizing branded, non-violent, consumer products, today announced the extension of stock-purchase warrants issued to shareholders in 2006.

“Our hard working board is confident that the turn-around strategy will improve operating performance,” comments Ronald Kaplan, Chairman, on behalf of the board. “We believe new management coupled with revitalization of M&A activities will keep the stock-purchase warrants issued to our shareholders in 2006 relevant in the foreseeable future. Our objective, as always, is to increase shareholder value, improve liquidity and maintain a healthy balance sheet as the company grows organically and externally.”

The company increased revenues year over year in 2003, 2004, and 2005, but with a shift in strategy, saw a decline in sales in 2006 coupled with increased operating and non-operating expenses. Management changes and cost-cutting measures began in the later half of the year and are expected to have a positive impact in 2007.

The terms of the warrant, as specified in the company’s SEC filings have been extended to be exercisable (for one share of common stock) at $3.25 through January 31, 2008, and then exercisable at $3.75 through January 31, 2010.

About Action Products International Inc.

Action Products International Inc. (APII), based in Orlando, Fla., is a Consumer Products manufacturer, emphasizing branded, educational, and positive leisure products. Action Products consumer brands span activities, arts, crafts, juvenile products and toy categories. Its products are marketed and sold to retailers and consumers.

Visit the Company’s Web sites at www.apii.com and www.curiositykits.com.

Forward-Looking Statements: 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, intellectual property rights, the outcome of competitive products, risks in product development, the results of financing efforts, the ability to complete transactions, and other factors discussed from time to time in the Company’s Securities and Exchange Commission filings. The Company undertakes no obligation to update or revise any forward-looking statement for events or circumstances after the date on which such statement is made.

Contact:

Contact:

Wendy Jo Moyer

Action Products International, Inc.

(407) 590-6343

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