Michael Jaffa
About Michael Jaffa
Michael A. Jaffa (age 59) serves as Chief Operating Officer, General Counsel, and Corporate Secretary of Kartoon Studios (TOON). He was promoted to COO on December 7, 2020 and previously served as General Counsel and Corporate Secretary since April 2018 . Company performance context during his tenure: cumulative TSR based on a fixed $100 investment measured per SEC rules was $44 (2022), $13 (2023), and $6 (2024) ; revenue trended from $62.299M (FY22) to $44.085M (FY23) to $32.591M (FY24) [FY22–FY24 revenues: S&P Global]; EBITDA was negative across FY22–FY24 [FY22–FY24 EBITDA: S&P Global].
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Cumulative TSR – $100 initial value | $44 | $13 | $6 |
| Revenues ($USD) | $62,299,000 [FY 2022: S&P Global]* | $44,085,000 [FY 2023: S&P Global]* | $32,591,000 [FY 2024: S&P Global]* |
| EBITDA ($USD) | $(20,719,000) [FY 2022: S&P Global]* | $(24,829,000) [FY 2023: S&P Global]* | $(14,588,000) [FY 2024: S&P Global]* |
Values retrieved from S&P Global*
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Kartoon Studios (TOON) | General Counsel & Corporate Secretary; later COO | Apr 2018–Dec 2020; COO from Dec 7, 2020 | Promoted to COO; oversees operations and legal |
| Thoughtful Media Group (TMG) | General Counsel & Global Head of Business Affairs | Jan 2017–Apr 2018 | Built international growth framework, franchise plan, SEA HQ; assisted M&A |
| DreamWorks Animation Television | Head of Business Affairs | Sep 2013–Dec 2016 | Led business affairs for television division |
| Hasbro Studios | Business Affairs leader | Dec 2009–Sep 2013 | Managed licensing, production, merchandising, complex transactions |
Fixed Compensation
| Year | Base Salary ($) | Target Bonus % | Actual Bonus Paid ($) | All Other Compensation ($) | Total ($) |
|---|---|---|---|---|---|
| 2023 | 419,826 | Not disclosed | 50,000 | 8,364 | 478,190 |
| 2024 | 450,000 | Not disclosed | 50,000 (renewal bonus) | – | 500,000 |
- Employment agreement provides scheduled base salary increases: $325,000 (Year 1), $375,000 (Year 2), and $450,000 (Years 3–5) .
- Entitled to an annual $50,000 bonus each year under the agreement .
Performance Compensation
Equity and Cash Incentives Structure
| Incentive Type | Grant / Terms | Vesting | Performance Metrics | Payout Mechanics |
|---|---|---|---|---|
| Stock Options | 100,000 options granted; exercise price $13.90; expiration 12/07/2030 | Partially vested at grant; remaining vested in substantially equal installments on first three anniversaries; all options fully vested by 12/07/2023 | None disclosed for options (service-based) | N/A |
| RSUs | 50,000 RSUs granted | Vested in three equal installments on first three anniversaries (service-based) | None disclosed for RSUs | Shares delivered upon vest; subject to transfer restrictions before issuance |
| Annual Bonus | $50,000 annual bonus under agreement | Annual | Not disclosed (agreement-based entitlement) | Cash payout |
- Company adopted an executive officer clawback policy effective December 1, 2023, requiring recovery of erroneously awarded incentive-based compensation following an accounting restatement; recovery applies even absent misconduct .
- An 8-K describes clawback rights conforming to Dodd-Frank, including repayment/surrender of “incentive-based” compensation upon restatement or certain policy breaches, and outlines severance framework triggers .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Total Beneficial Ownership | 150,000 shares (<1% of class) |
| Breakdown | 50,000 shares directly held; 100,000 shares issuable via a stock option exercisable within 60 days of Record Date |
| Shares Outstanding (Record Date) | 47,784,964 |
| Options Status | 100,000 options exercisable; strike $13.90; expire 12/07/2030 |
| Hedging & Pledging | Hedging, short sales, transactions in public options, margin accounts, and pledging Company securities are prohibited |
Outstanding Equity Awards (as of Dec 31, 2024)
| Name | Options Exercisable (#) | Options Unexercisable (#) | Option Exercise Price ($) | Option Expiration | RSUs Unvested (#) | Market Value of Unvested RSUs ($) |
|---|---|---|---|---|---|---|
| Michael A. Jaffa | 100,000 | – | 13.90 | 12/07/2030 | – | – |
- Closing price used for award valuations on 12/31/2024 was $0.59, indicating options were significantly out-of-the-money at year-end 2024 .
Employment Terms
| Term | Detail |
|---|---|
| Role & Start Dates | GC & Corporate Secretary (Apr 2018); promoted to COO on Dec 7, 2020 |
| Agreement Term | Five-year term commencing Effective Date; extension only by mutual written agreement; neither party obliged to extend |
| Current Term End | Extended through December 7, 2025 |
| Base Salary Schedule | $325,000 (Year 1), $375,000 (Year 2), $450,000 (Years 3–5) |
| Annual Bonus | Entitled to $50,000 each year under agreement; Board may also determine discretionary annual bonuses |
| Renewal Bonuses | $50,000 beginning within 60 days of effective date and on each anniversary during term, subject to continued employment |
| Separation – Death/Retirement ≥65 | Accrued base salary/vacation/expense reimbursement; any unpaid annual bonus for the prior fiscal year |
| Separation – Permanent Disability | Accrued base salary/expense reimbursement; any unpaid annual bonus for the prior fiscal year; for two months, monthly payments equal to any excess of monthly base salary over disability benefits (subject to a release) |
| Restrictive Covenants | Confidentiality, IP, non-compete, non-solicitation included in agreement ; 8-K further details policy definitions and obligations |
| Clawback | Executive officer clawback policy (12/01/2023) for restatement-related recovery ; 8-K describes Dodd-Frank conforming clawback rights |
| Corporate Secretary | Signed April 3, 2025 proxy as Corporate Secretary |
Investment Implications
- Pay structure balance: Fixed pay is substantial ($450k base in 2024) with a $50k annual bonus entitlement and renewal bonuses, suggesting limited direct linkage to financial performance metrics for Jaffa versus service-based vesting on legacy equity awards .
- Selling pressure risk: With options fully vested as of 12/07/2023 and deeply out-of-the-money at $0.59 YE 2024 versus $13.90 strike, near-term insider selling pressure from option exercises appears low absent significant price appreciation .
- Alignment: Beneficial ownership is modest (<1%), but hedging and pledging prohibitions support alignment; lack of disclosed executive ownership guidelines limits assessment of required “skin-in-the-game” .
- Retention: Contract runs through 12/07/2025 with renewal bonuses and restrictive covenants (non-compete, non-solicit) plus severance terms for death/disability, collectively reducing near-term attrition risk .
- Governance and risk controls: Dodd-Frank conforming clawback rights and executive officer clawback policy mitigate incentive-based compensation risk in restatement scenarios .