FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of June, 2005
Commission File Number: 0-23696
RADICA GAMES LIMITED
(Translation of registrant's name into English)
Suite V, 6/F., 2-12 Au Pui Wan Street, Fo Tan, Hong Kong
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or 40-F
Form 20-F X Form 40-F
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Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(1):
Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(7):
Indicate by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing the information to
the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.
Yes No X
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If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b): 82-___________
Contents:
1. Update respecting Risk Factors
This Report on Form 6-K shall be deemed to be incorporated by reference
into the Registrant's Registration Statements on Form S-8 (No. 33-86960, No.
333-7000, No. 333-59737, 333-61260 and 333-122248) and on Form F-3 (No. 333-7526
and No. 333-79005).
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The following is intended to update our risk factors as disclosed in our 2004
Annual Report on Form 20-F and as previously updated in our Form 6-K report
furnished to the Securities and Exchange Commission as of June 8, 2005. The
first two and the last paragraphs under the following caption repeat verbatim
the disclosure in our June 8, 2005 Form 6-K. The third, fourth and fifth
paragraphs provide an update to that disclosure.
RISK FACTORS
For a discussion of our risk factors, see "Item 3. Key Information - Risk
Factors" and "Item 5. Operating and Financial Review and Prospects" in our 2004
Form 20-F.
As reported in our 2004 annual report on Form 20-F, in March 2005 we received a
letter from a third party (AtGames Holdings Ltd., or AtGames) challenging the
exclusivity of our manufacturing, vendor and distributor agreement with Sega
Toys, which was represented to give us exclusive rights to the Play TV Sega
Genesis games in the United States and certain other countries. Subsequently, we
have worked closely with Sega Toys and Sega Corporation in an attempt to clarify
our rights. We continue to believe that we have a strong position on the merits
of the dispute as well as certain rights to indemnification from Sega Toys. Sega
Corporation has advised us in writing that its position is that Sega has not
granted AtGames any right to license Sega's Genesis/Mega Drive game titles for
incorporation in TV game pads intended for worldwide markets. AtGames contends
otherwise. Sega and AtGames have submitted their dispute to arbitration, and the
arbitration hearing is currently scheduled to begin on September 26, 2005. Sega
further stated its understanding that under the agreement between Radica and
Sega Toys, Sega Toys has granted Radica the exclusive right to sell Play TV
products incorporating selected Sega Genesis game titles in the United States
and certain other territories under a license granted by Sega to Sega Toys.
On June 13, 2005, AtGames filed a complaint against Radica Games Limited and our
subsidiary Radica (Macao Commercial Offshore) Limited, or Radica Macao, in the
California Superior Court, County of Los Angeles, alleging intentional
interference with contract and unfair competition. The complaint seeks
substantial compensatory damages, punitive damages, declaratory relief and
injunctive relief. The Radica parties consider this suit to be without merit and
intend to defend against it vigorously.
Previously, Radica Macao had filed suit in the California Superior Court, Los
Angeles County, West District, against the attorneys representing AtGames. The
Radica Macao complaint alleges misappropriation of trade secrets, conversion and
unfair business practices. The complaint seeks compensatory damages, punitive
damages and injunctive relief.
In addition, and supplemental to two prior indemnification demands, the Radica
parties have made formal demand on Sega Toys for indemnification respecting the
action recently filed by AtGames.
We are presently unable to predict the outcome of the foregoing dispute. We
intend to vigorously defend our rights, and continue to believe in the strength
of our position with respect to exclusive rights in the United States and
certain other territories concerning Play TV Sega Genesis games. Nevertheless,
as we stated in our 2004 Form 20-F, this situation illustrates that in certain
cases we may face additional unanticipated competition from another party who
also has rights, or who asserts that it has rights, in the intellectual property
that we are using or intending to use, this may have a material adverse effect
on the sales and profitability of the products concerned. We may also incur
substantial costs and management time in defending, or attempting to defend, our
rights.
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SIGNATURE
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Pursuant to the requirements of Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
RADICA GAMES LIMITED
Date: June 14, 2005 /s/ Craig D. Storey
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Craig D. Storey
Chief Accounting Officer
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