Blizzard 2004 Annual Report Download - page 54

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Acquisition of Treyarch Effective October 1, 2001, we acquired all of the outstanding ownership interests of Treyarch
Invention, LLC (“Treyarch”), a privately held interactive software development company, in exchange for 1,842,663
shares of our common stock. Treyarch is an experienced, multi-platform console software developer with a focus on
action and action sports video games. As part of the original acquisition agreement, approximately 540,000 additional
shares of our common stock could also be issued to Treyarch’s equity holders and employees over the course of several
years, depending on the satisfaction of certain product performance requirements and other criteria. This contingent
consideration would be recorded as an additional element of the purchase price for Treyarch when those contingencies
were resolved. In July 2002, in connection with the satisfaction of certain of those product performance requirements,
we issued to Treyarch equity holders and employees 228,680 of our common shares with an assigned value of $2.7
million. The purchase price of the transaction, including the contingent consideration issued in July 2002, forgiveness of
a note receivable and acquisition costs, was valued at approximately $18.2 million with approximately $17.2 million
of the purchase price being assigned to goodwill. This goodwill has been included in the publishing segment of our
business and is non-deductible for tax purposes. The results of operations of Treyarch are included in our consolidated
statement of operations beginning October 1, 2001. As of March 31, 2004, all contingencies relating to the issuance
of additional shares as consideration have been resolved.
4. Cash, Cash Equivalents, and Short-Term Investments
The following table summarizes our cash, cash equivalents and short-term investments as of March 31, 2004 (amounts
in thousands):
Gross Gross
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
Cash and cash equivalents:
Cash and time deposits $101,414 $ — $ — $101,414
Money market funds 60,006 — — 60,006
Commercial paper 3,700 — — 3,700
Auction rate notes 301,432 — — 301,432
Cash and cash equivalents 466,552 — — 466,552
Short-term investments:
Corporate bonds 21,047 13 (24) 21,036
U.S. agency issues 71,817 76 (4) 71,889
Asset-backed bonds 23,113 74 (38) 23,149
Municipal bonds 5,023 — — 5,023
Short-term investments 121,000 163 (66) 121,097
Cash, cash equivalents and short-term investments $587,552 $163 $(66) $587,649
Activision, Inc. — 2004 Annual Report
page 57