Hello all! It has been a long time coming but finally we are seeing a little upward movement in our investment. The rapid
decline in short position has not gone un-noticed here. But we seem to be on the edge of a huge technological advantage in
the hand-held game industry. Lest we forget, these are the acquisition & alliance statements from the company's 6K…
5. ACQUISITION
On June 24, 1999, Radica acquired all of the business and operating assets
of Leda Media Products Limited ("LMP"), the leading supplier of video game
controllers in the U.K. The Company purchased LMP for approximately $16
million. The acquisition price consisted of cash payment of approximately
$2.6 million, LMP net indebtedness of approximately $1.1 million and
issuance of notes payable for $12.3 million. The transaction has been
accounted for using the purchase method. The purchase price has been
allocated to the assets acquired and liabilities assumed based on estimates
of fair values as of the acquisition date. The Company recorded intangible
asset of approximately $13.5 million which is being amortized on a
straight-line basis over a fifteen year fiscal period.
6. INTANGIBLE ASSETS
During the quarter, the Company and Electronic Arts(TM) ("EA") announced a
strategic alliance for the extension of EA brands and game properties in
the dedicated electronic handheld game category. As part of this alliance,
the Company entered into a worldwide licensing agreement with EA. In an
additional agreement, the Company granted EA warrants to purchase 375,000
shares of the Company common stock during the term of the agreement. The
agreement with EA runs through the end of 2002. The fair value of the
warrants, or $666, has been recorded as an intangible asset for the
acquired brand name. The asset is being amortized on a straight-line basis
over the term of agreement.
Now add the SSD deal announced yesterday and you see why I liked the LMP/EA deals last year. Think about it. Leading
game controler combined with leading game software company combined with New technology of SSB….and, viola. You
are able to play the best computer games (EA) with best controler pad (LMP) on your TV set (via SSB technology) through
your handheld game made by RADA!! Computer games and graphics with no computer!! Get it? Also note the agreement
with LMP and EA. WE own LMP and we have "A worldwide Licenseing agreement" with EA. It has come full circle. No
other handheld game company will be able to compete for at least one full cycle!!! Hey I didn't average down (yet), but at
least I didn't sell and boy am I glad! As always…
Best Wishes,
Swedelo |
