COLLECTORS UNIVERSE INC

The Tender Offer expired at 12:00 midnight, New York time on February 5, 2021 (the “Expiration Date”). Broadridge Corporate Issuer Solutions, Inc., the depositary for the Tender Offer (the “Depositary”), advised Parent and Purchaser that, as of the Expiration Date, an aggregate of 5,179,075 shares of common stock (including shares of common stock treated as “rollover stock” within the meaning of Section 251(h) of the General Corporation Law of the State of Delaware, but excluding 1,093,255 shares of common stock tendered pursuant to guaranteed delivery procedures that have not yet been “received” (as defined by Section 251(h)(6) of the General Corporation Law of the State of Delaware)) had been validly tendered and not validly withdrawn pursuant to the Tender Offer. These shares of common stock represented approximately 57% of the aggregate number of shares of common stock outstanding. Because all conditions to the Tender Offer were satisfied or waived as of the Expiration Date, Purchaser accepted for payment all shares of common stock validly tendered and not validly withdrawn pursuant to the Tender Offer, and, in accordance with the terms of the Tender Offer, payment for such shares of common stock will be promptly made to the Depositary, which will then transmit such payments to the Company’s stockholders whose shares of common stock have been accepted for payment.

Following consummation of the Tender Offer, on February 8, 2021, pursuant to the terms of the A&R Merger Agreement and in accordance with Section 251(h) of the General Corporation Law of the State of Delaware, the merger of the Purchaser into the Company with the Company as the surviving corporation was consummated (the “Merger”). In connection with the Merger, each share of common stock that was issued and outstanding as of immediately prior to the effective time of the Merger (the “Effective Time”) (except as provided in the A&R Merger Agreement) was cancelled and extinguished and automatically converted into the right to receive cash in an amount equal to the Offer Price.

Additionally, although it may appear to be counterintuitive, we believe that the COVID-19 pandemic has actually contributed to the substantial increases we have experienced in trading card submissions and revenues in the three and six months ended December 31, 2020, because sports enthusiasts and other collectors have had to spend considerably more time at home and have been unable to attend live sporting events as a result of the COVID-19 pandemic and that, , in turn, appears to have led to renewed interest in collecting and in the on-line buying and selling of sports and other cards. There is no assurance that the renewed interest in collecting and in the on-line buying and selling of sports and other cards will continue after the pandemic finally subsides.

The increases in volume of trading cards and autographs we were able to authenticate and grade during the first six months of this year comprised a higher mix of higher priced top-tier services which was reflected in a higher ASP as compared to the prior year six months. Our remaining backlog at December 31, 2020 was comprised, to a greater extent, of submissions for lower priced services. Consequently, we expect that the rate of growth of trading cards / autographs revenues will slow somewhat over time; but revenues in this year’s second half will nevertheless substantially exceed the trading cards / autographs revenues generated in the second half of last year.

The substantial increase in the rate of growth of the revenues we generated from the authentication and grading of sports and other cards and autographs during the first half of fiscal 2021 may decline in the future. As we have reported, that record was achieved primarily as a result of (i) record demand for the authentication and grading of sports and other cards and autographs, which we believe is at least attributable in part to the COVID-19 lockdown and restrictions on attending sporting events, which have led sports enthusiasts and card collectors to increase their online purchases and sales and trading of sports and other cards, (ii) a substantial increase in ASPs earned, because more customers were willing to pay higher prices for top-tier services, including faster authentication and grading turnaround times, and (iii) an increase in volume of trading cards and autographs we were able to authenticate and grade during the six months ended December 31, 2020. However, the remaining backlog of trading cards and autograph submissions at December 31, 2020 was comprised, to a greater extent, of submissions for lower priced services. In addition, the prices that customers are prepared to pay for our card grading and authentication services are driven by the values realized (or realizable) in the collectibles market, and we have no control over those values such that if values realized decline, then collectors may not submit cards for authentication and grading, or submissions may qualify for lower-tier services, with resulting reductions to us in average selling price, gross profit margins and operating income. Therefore, we expect that the rate of growth of trading cards / autographs revenues will slow somewhat over time. Also, when restrictions on outdoor activity imposed in response to the COVID-19 pandemic are lifted and sports fans are again able to attend sporting events, there is no assurance that demand for our cards / autographs authentication and grading services experienced during the first half of fiscal 2021 will not decrease and cause a decline in those revenues over the longer term.