Settlement
Author
The Hasbro lawsuit has been settled. All defendants agreed to settle except for Xtreme Games, which will continue to litigate.
I am extremely pleased with the terms of the settlement. MVP came out of this in a stronger position financially as well as other ways than we were in before the lawsuit is filed. Financial terms of the settlement agreement are confidential, so there is nothing more I can say about that.
The settlement requires us to pull Debris from the market. However, we did not agree that our games infringe Hasbro''s copyrights, and we did not agree to restrictions of any kind to future games.
Did eGames also settled ???
How about 3d astroblaster, 3d tetrimania, 3d maze man, and the other games? Are they been destroed.
How about 3d astroblaster, 3d tetrimania, 3d maze man, and the other games? Are they been destroed.
eGames Announces Settlement of Hasbro Litigation
Fiscal Fourth Quarter Results Revised to Account for Settlement Costs
LANGHORNE, Pa., Sept. 7 /PRNewswire/ -- eGames, Inc. (Nasdaq: EGAM), a
leading provider of Family Friendly(TM) value-priced computer software games
for players of all ages, today announced that it has settled the trademark and
copyright infringement suit filed by Hasbro Interactive, Atari Interactive and
Elorg in the U.S. District Court in Boston, Massachusetts by entering into an
agreement by consent judgment.
Under the terms of the settlement agreement, eGames will incur a
non-recurring expense of $205,000 charged against the Company''s fiscal 2000
fourth quarter, ended June 30, 2000. As a result, this charge will reduce the
Company''s previously reported earnings per share by $0.02 for the fiscal 2000
fourth quarter and full-year periods.
The settlement does not require the recall of any eGames products and also
does not admit to any infringement by eGames of the games named in the suit.
Also, under the terms of the settlement, eGames will continue to sell certain
games alleged to infringe on Hasbro''s copyrights through September 30, 2000,
at which point these products will be discontinued. The settlement involves
the following eGames'' titles: Intergalactic Exterminator, 3D Astro Blaster,
Missile Launch., Missile Launch 2000, TetriMania, TetriMania Master, 3D
TetriMania, 3D Maze Man, 3D Chomper, 3D Frogman, 3D Ms. Maze and Tunnel
Blaster. Discontinuing these titles is not expected to have a material impact
on the Company''s fiscal 2001 revenue expectations.
Jerry Klein, President and CEO of eGames commented, "We are pleased to put
this issue behind the Company, enabling us to return 100% of our attention to
the successful implementation of our business model. Although we believe that
we had substantial defenses to the claims in the lawsuit and that the claims
were ultimately without merit, we also believe that this settlement is in the
best interest of our shareholders. Not only does it allow the Company to
avoid the expense of ongoing litigation, but it enables us to focus on doing
what we do best -- providing high-quality, value-priced computer software
games to the casual game player market. We remain excited about the products
we currently have on the market and about a number of new products that are
scheduled to be launched later this year."
eGames, Inc., headquartered in Langhorne, PA, develops, publishes and
markets a diversified line of personal computer software primarily for
consumer entertainment and personal productivity. More information about
eGames products, as well as free downloadable product demos, are available at
the company''s website at http://www.egames.com .
This press release contains certain forward-looking statements, including
without limitation, statements that the discontinuance of the Company''s
Intergalactic Exterminator, 3D Astro Blaster, Missile Launch, Missile Launch
2000, TetriMania, TetriMania Master, 3D TetriMania, 3D Maze Man, 3D Chomper,
3D Frogman, 3D Ms. Maze and Tunnel Blaster titles (the "Discontinued Titles")
is not expected to have a material impact on the Company''s fiscal 2001 revenue
expectations; statements regarding the amount of the non-recurring expense
related to the Hasbro settlement to be charged against the Company''s fiscal
2000 fourth quarter ended June 30, 2000 and the resulting reduction to the
Company''s earnings per share for the fiscal 2000 fourth quarter and full-year
periods; and statements regarding the Company''s new products that are
scheduled to be launched later this year. The actual results achieved by the
Company and the factors that could cause actual results to differ materially
from those indicated by the forward-looking statements are in many ways beyond
the Company''s control. The Company cautions readers that the following
important factors, among others, could cause the Company''s actual results to
differ materially from those expressed in this press release: the ability of
the Company to sell the remaining inventory of products containing the
Discontinued Titles prior to September 30, 2000; the amount of returns of the
Company''s products containing the Discontinued Titles after September 30,
2000; successful sell-through results for the Company''s products at retail
stores and the Company''s ability to accurately estimate sell-through volume
when an order is shipped; the Company''s ability to accurately predict the
amount of product returns that will occur and the adequacy of the reserves
established for such returns; the Company''s ability to continue to enter into
new distribution and direct sales relationships on commercially acceptable
terms as well as the ability to generate continued sales within existing
retail and distribution relationships; the ability of the Company to continue
to increase its market share; increased selling, general and administrative
costs, including increased legal expenses, costs and charges; the allocation
of adequate shelf space for the Company''s products in major chain retail
stores; downward pricing pressure; fluctuating costs of developing, producing
and marketing the Company''s products; the Company''s ability to license or
develop quality content for its products; the timeliness and success of
developing and selling products; the acceptance by the market of the Company''s
products; and various other risk factors described in the Company''s reports,
including Form 10-KSB for the year ended June 30, 1999 and Form 10-QSB for the
quarter ended March 31, 2000, filed by the Company with the Securities and
Exchange Commission.
eGames, Inc.
Consolidated Statements of Operations
(Unaudited)
Three months ended Years ended
June 30, June 30,
2000 1999 2000 1999
Net sales $3,077,595 $1,383,264 $13,640,160 $10,022,305
Cost of sales 1,304,025 642,182 5,301,828 3,596,982
Gross profit 1,773,570 741,082 8,338,332 6,425,323
Operating expenses:
Product development 195,259 233,772 860,330 936,938
Selling, general and
administrative 1,422,029 1,350,073 6,772,136 4,814,345
Litigation and
settlement costs 281,458 0 360,568 0
Total operating
expenses 1,898,746 1,583,845 7,993,034 5,751,283
Operating income
(loss) (125,176) (842,763) 345,298 674,040
Interest expense
(income), net 256 (666) 11,967 31,761
Income (loss) before
income taxes (125,432) (842,097) 333,331 642,279
Provision for
income taxes 2,454 20,937 80,750 179,724
Net income (loss) ($127,886) ($863,034) $252,581 $462,555
Net income (loss)
per common share:
- Basic ($0.01) ($0.09) $0.03 $0.05
- Diluted ($0.01) ($0.09) $0.03 $0.05
Weighted average common
shares outstanding
- Basic 9,749,975 9,600,935 9,706,813 9,494,988
Dilutive effect of
common stock equivalents 0 0 290,200 344,453
Weighted average common
shares outstanding
- Diluted 9,749,975 9,600,935 9,997,013 9,839,441
eGames, Inc.
Consolidated Balance Sheet
(Unaudited)
As of June 30, 2000
ASSETS
Current assets:
Cash and cash equivalents $1,139,178
Accounts receivable, net of
allowances - $1,329,098 2,742,414
Inventory 2,145,142
Prepaid expenses 263,595
Total current assets 6,290,329
Furniture and equipment, net 336,135
Other assets 295,043
Total assets $6,921,507
LIABILITIES AND STOCKHOLDERS'' EQUITY
Current liabilities:
Notes payable $59,487
Accounts payable 2,073,076
Accrued expenses 798,189
Convertible subordinated debt 150,000
Capital lease obligations 18,971
Total current liabilities 3,099,723
Capital lease obligations, net
of current portion 984
Notes payable, net of current portion 124,220
Total liabilities 3,224,927
Stockholders'' equity:
Common stock, no par value
(40,000,000 shares authorized; 9,981,875
issued and 9,749,975 outstanding) 9,134,234
Additional paid-in capital 1,148,550
Accumulated deficit (6,015,588)
Treasury stock, at cost - 231,900 shares (501,417)
Accumulated other comprehensive loss (69,199)
Total stockholders'' equity 3,696,580
Total liabilities and
stockholders'' equity $6,921,507
SOURCE eGames, Inc.
Fiscal Fourth Quarter Results Revised to Account for Settlement Costs
LANGHORNE, Pa., Sept. 7 /PRNewswire/ -- eGames, Inc. (Nasdaq: EGAM), a
leading provider of Family Friendly(TM) value-priced computer software games
for players of all ages, today announced that it has settled the trademark and
copyright infringement suit filed by Hasbro Interactive, Atari Interactive and
Elorg in the U.S. District Court in Boston, Massachusetts by entering into an
agreement by consent judgment.
Under the terms of the settlement agreement, eGames will incur a
non-recurring expense of $205,000 charged against the Company''s fiscal 2000
fourth quarter, ended June 30, 2000. As a result, this charge will reduce the
Company''s previously reported earnings per share by $0.02 for the fiscal 2000
fourth quarter and full-year periods.
The settlement does not require the recall of any eGames products and also
does not admit to any infringement by eGames of the games named in the suit.
Also, under the terms of the settlement, eGames will continue to sell certain
games alleged to infringe on Hasbro''s copyrights through September 30, 2000,
at which point these products will be discontinued. The settlement involves
the following eGames'' titles: Intergalactic Exterminator, 3D Astro Blaster,
Missile Launch., Missile Launch 2000, TetriMania, TetriMania Master, 3D
TetriMania, 3D Maze Man, 3D Chomper, 3D Frogman, 3D Ms. Maze and Tunnel
Blaster. Discontinuing these titles is not expected to have a material impact
on the Company''s fiscal 2001 revenue expectations.
Jerry Klein, President and CEO of eGames commented, "We are pleased to put
this issue behind the Company, enabling us to return 100% of our attention to
the successful implementation of our business model. Although we believe that
we had substantial defenses to the claims in the lawsuit and that the claims
were ultimately without merit, we also believe that this settlement is in the
best interest of our shareholders. Not only does it allow the Company to
avoid the expense of ongoing litigation, but it enables us to focus on doing
what we do best -- providing high-quality, value-priced computer software
games to the casual game player market. We remain excited about the products
we currently have on the market and about a number of new products that are
scheduled to be launched later this year."
eGames, Inc., headquartered in Langhorne, PA, develops, publishes and
markets a diversified line of personal computer software primarily for
consumer entertainment and personal productivity. More information about
eGames products, as well as free downloadable product demos, are available at
the company''s website at http://www.egames.com .
This press release contains certain forward-looking statements, including
without limitation, statements that the discontinuance of the Company''s
Intergalactic Exterminator, 3D Astro Blaster, Missile Launch, Missile Launch
2000, TetriMania, TetriMania Master, 3D TetriMania, 3D Maze Man, 3D Chomper,
3D Frogman, 3D Ms. Maze and Tunnel Blaster titles (the "Discontinued Titles")
is not expected to have a material impact on the Company''s fiscal 2001 revenue
expectations; statements regarding the amount of the non-recurring expense
related to the Hasbro settlement to be charged against the Company''s fiscal
2000 fourth quarter ended June 30, 2000 and the resulting reduction to the
Company''s earnings per share for the fiscal 2000 fourth quarter and full-year
periods; and statements regarding the Company''s new products that are
scheduled to be launched later this year. The actual results achieved by the
Company and the factors that could cause actual results to differ materially
from those indicated by the forward-looking statements are in many ways beyond
the Company''s control. The Company cautions readers that the following
important factors, among others, could cause the Company''s actual results to
differ materially from those expressed in this press release: the ability of
the Company to sell the remaining inventory of products containing the
Discontinued Titles prior to September 30, 2000; the amount of returns of the
Company''s products containing the Discontinued Titles after September 30,
2000; successful sell-through results for the Company''s products at retail
stores and the Company''s ability to accurately estimate sell-through volume
when an order is shipped; the Company''s ability to accurately predict the
amount of product returns that will occur and the adequacy of the reserves
established for such returns; the Company''s ability to continue to enter into
new distribution and direct sales relationships on commercially acceptable
terms as well as the ability to generate continued sales within existing
retail and distribution relationships; the ability of the Company to continue
to increase its market share; increased selling, general and administrative
costs, including increased legal expenses, costs and charges; the allocation
of adequate shelf space for the Company''s products in major chain retail
stores; downward pricing pressure; fluctuating costs of developing, producing
and marketing the Company''s products; the Company''s ability to license or
develop quality content for its products; the timeliness and success of
developing and selling products; the acceptance by the market of the Company''s
products; and various other risk factors described in the Company''s reports,
including Form 10-KSB for the year ended June 30, 1999 and Form 10-QSB for the
quarter ended March 31, 2000, filed by the Company with the Securities and
Exchange Commission.
eGames, Inc.
Consolidated Statements of Operations
(Unaudited)
Three months ended Years ended
June 30, June 30,
2000 1999 2000 1999
Net sales $3,077,595 $1,383,264 $13,640,160 $10,022,305
Cost of sales 1,304,025 642,182 5,301,828 3,596,982
Gross profit 1,773,570 741,082 8,338,332 6,425,323
Operating expenses:
Product development 195,259 233,772 860,330 936,938
Selling, general and
administrative 1,422,029 1,350,073 6,772,136 4,814,345
Litigation and
settlement costs 281,458 0 360,568 0
Total operating
expenses 1,898,746 1,583,845 7,993,034 5,751,283
Operating income
(loss) (125,176) (842,763) 345,298 674,040
Interest expense
(income), net 256 (666) 11,967 31,761
Income (loss) before
income taxes (125,432) (842,097) 333,331 642,279
Provision for
income taxes 2,454 20,937 80,750 179,724
Net income (loss) ($127,886) ($863,034) $252,581 $462,555
Net income (loss)
per common share:
- Basic ($0.01) ($0.09) $0.03 $0.05
- Diluted ($0.01) ($0.09) $0.03 $0.05
Weighted average common
shares outstanding
- Basic 9,749,975 9,600,935 9,706,813 9,494,988
Dilutive effect of
common stock equivalents 0 0 290,200 344,453
Weighted average common
shares outstanding
- Diluted 9,749,975 9,600,935 9,997,013 9,839,441
eGames, Inc.
Consolidated Balance Sheet
(Unaudited)
As of June 30, 2000
ASSETS
Current assets:
Cash and cash equivalents $1,139,178
Accounts receivable, net of
allowances - $1,329,098 2,742,414
Inventory 2,145,142
Prepaid expenses 263,595
Total current assets 6,290,329
Furniture and equipment, net 336,135
Other assets 295,043
Total assets $6,921,507
LIABILITIES AND STOCKHOLDERS'' EQUITY
Current liabilities:
Notes payable $59,487
Accounts payable 2,073,076
Accrued expenses 798,189
Convertible subordinated debt 150,000
Capital lease obligations 18,971
Total current liabilities 3,099,723
Capital lease obligations, net
of current portion 984
Notes payable, net of current portion 124,220
Total liabilities 3,224,927
Stockholders'' equity:
Common stock, no par value
(40,000,000 shares authorized; 9,981,875
issued and 9,749,975 outstanding) 9,134,234
Additional paid-in capital 1,148,550
Accumulated deficit (6,015,588)
Treasury stock, at cost - 231,900 shares (501,417)
Accumulated other comprehensive loss (69,199)
Total stockholders'' equity 3,696,580
Total liabilities and
stockholders'' equity $6,921,507
SOURCE eGames, Inc.
Did you read this NONSENSE:
press release contains certain forward-looking statements, including without limitation, statements that the discontinuance of the Company''s Intergalactic Exterminator, 3D Astro Blaster, Missile Launch, Missile Launch 2000, TetriMania, TetriMania Master, 3D TetriMania, 3D Maze Man, 3D Chomper,3D Frogman, 3D Ms. Maze and Tunnel Blaster titles (the "Discontinued Titles")
Here it come:
is NOT expected to have a material impact on the Company''s fiscal 2001 revenue xpectations;
THAT IS BIG NONSENSE IT WILL HAVE IMPACT ,BECUASE IT WERE THE BESTSELLING PRODUCTS OF EGAMES.
press release contains certain forward-looking statements, including without limitation, statements that the discontinuance of the Company''s Intergalactic Exterminator, 3D Astro Blaster, Missile Launch, Missile Launch 2000, TetriMania, TetriMania Master, 3D TetriMania, 3D Maze Man, 3D Chomper,3D Frogman, 3D Ms. Maze and Tunnel Blaster titles (the "Discontinued Titles")
Here it come:
is NOT expected to have a material impact on the Company''s fiscal 2001 revenue xpectations;
THAT IS BIG NONSENSE IT WILL HAVE IMPACT ,BECUASE IT WERE THE BESTSELLING PRODUCTS OF EGAMES.
THE GAMES ARE STILL AVAILABLE ON THERE SITE
]
http://www.egames.com/_asp/egames.asp?nav=games&con=pro&upc=743999103009
http://www.egames.com/_asp/egames.asp?nav=arcade&con=cat&cat=1
]
http://www.egames.com/_asp/egames.asp?nav=games&con=pro&upc=743999103009
http://www.egames.com/_asp/egames.asp?nav=arcade&con=cat&cat=1
Also from there distrubution partners:
http://www.newmediaonline.it/html/family.htm
http://www.newmediaonline.it/html/egames/egames1.htm
http://www.newmediaonline.it/html/family.htm
http://www.newmediaonline.it/html/egames/egames1.htm
I had two words to say when I saw this: Oh Shit.
Personally, I feel all the settlement did was start a snowball effect - who knows what will happen because of this? I must congradulate(sp?) Andre for sticking it out and not settling with Big Evil Power Hungry Company. There you have it: my two cents.
Personally, I feel all the settlement did was start a snowball effect - who knows what will happen because of this? I must congradulate(sp?) Andre for sticking it out and not settling with Big Evil Power Hungry Company. There you have it: my two cents.
Author
I believe that the terms of the settlement represent a big victory for Egames, MVP and Webfoot. Xtreme was in a somewhat different position and chose not to settle.
In MVP''s case, we are pulling a 3-1/2 year old game off the shelves, a game that Egames had previously discontinued anyway because it had run its course. Big deal. Hasbro spent over $1 mil. in legal fees for that?
The key thing here is that there are no restrictions on future games. None at all. We are free to do any games of any kind that we chose to do.
If you think about that for even one minute, you will immediately understand that Hasbro didn''t spend all that money to eliminate old games. They wanted a lot more, and they didn''t get it.
BTW, the rumors are that Hasbro is looking to get out of the computer games business altogether. Could that be why they settled on such unfavorable (for them) terms?
In MVP''s case, we are pulling a 3-1/2 year old game off the shelves, a game that Egames had previously discontinued anyway because it had run its course. Big deal. Hasbro spent over $1 mil. in legal fees for that?
The key thing here is that there are no restrictions on future games. None at all. We are free to do any games of any kind that we chose to do.
If you think about that for even one minute, you will immediately understand that Hasbro didn''t spend all that money to eliminate old games. They wanted a lot more, and they didn''t get it.
BTW, the rumors are that Hasbro is looking to get out of the computer games business altogether. Could that be why they settled on such unfavorable (for them) terms?
THE AFTERMATH:
How ever good MVPSoft considers the deal there are a few points i have to mention here:.
1) I know from bitter experience that egames move with glacial speed. I''m sure they willl eventually remove those titles from their site. (Good news for me - I have one of the few title selling by thm that isnt affected - more space for my title i guess, but a bitter victory)
2) Debris may be x years old, but its a great little game. I still fire it up occasionally for a quick blast. I can play 2 rounds of debris in the time it takes Unreal Tournament to load. The principle is important here. It dosent matter how old my games get, I would be very bitter if some lawyer swine stopped me seling them.
3)If the impact on MVP is so low, and I have no reason to believe otherwise (I''m also very pleased this is the case), then you have to ask what HasBorg achieved: it cost them a fortune, and I doubt Intergalactic Extermintaor really threatened Hasborgs sales.
One can''t help thinking however, that this distracted both egames,xtreme and MVPSoft from doing what they should be doing - making games. Every day in court is a day away from the compiler.
Even if the judge had finally thrown the case out, there is still a lot of wasted time for the developers.
These are sad times dudes.
http://www.positech.co.uk
How ever good MVPSoft considers the deal there are a few points i have to mention here:.
1) I know from bitter experience that egames move with glacial speed. I''m sure they willl eventually remove those titles from their site. (Good news for me - I have one of the few title selling by thm that isnt affected - more space for my title i guess, but a bitter victory)
2) Debris may be x years old, but its a great little game. I still fire it up occasionally for a quick blast. I can play 2 rounds of debris in the time it takes Unreal Tournament to load. The principle is important here. It dosent matter how old my games get, I would be very bitter if some lawyer swine stopped me seling them.
3)If the impact on MVP is so low, and I have no reason to believe otherwise (I''m also very pleased this is the case), then you have to ask what HasBorg achieved: it cost them a fortune, and I doubt Intergalactic Extermintaor really threatened Hasborgs sales.
One can''t help thinking however, that this distracted both egames,xtreme and MVPSoft from doing what they should be doing - making games. Every day in court is a day away from the compiler.
Even if the judge had finally thrown the case out, there is still a lot of wasted time for the developers.
These are sad times dudes.
http://www.positech.co.uk
I have a feeling this isn''t over yet. They might not have got everything they wanted, but that doesn''t mean they''re going to stop. If they actually win a case in court, I think that could mean some serious trouble for small game developers.
This topic is closed to new replies.
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