Vistaprint 2010 Annual Report Download - page 70

VISTAPRINT N.V.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years Ended June 30, 2010, 2009 and 2008
(in thousands, except share and per share data)
1. Description of the Business
The Vistaprint group of companies (the “Company”) offers micro businesses the ability to
market their businesses with a broad range of brand identity and promotional products, marketing
services and digital solutions. Through the use of proprietary Internet-based graphic design software,
localized websites, proprietary order receiving and processing technologies and advanced computer
integrated production facilities, the Company offers a broad spectrum of products ranging from
business cards, website hosting, brochures and invitations to marketing and creative services. The
Company focuses on serving the marketing, graphic design and printing needs of the micro business
market, generally businesses or organizations with fewer than 10 employees, often fewer than 5. The
Company also provides personalized products and services to the consumer market.
Change of Domicile
On August 31, 2009, the Company moved the place of incorporation of the publicly traded
parent entity of the Vistaprint group of companies from Bermuda to the Netherlands. Vistaprint N.V.
was formed as a limited liability company (nammlooze vennootschap) under the laws of the
Netherlands and pursuant to a scheme of arrangement under Bermuda law approved by the common
shareholders of Vistaprint Limited, among other things, each common share of Vistaprint Limited was
exchanged for one ordinary share of Vistaprint N.V.
As a result of the scheme of arrangement and the share exchange transaction, the common
shareholders of Vistaprint Limited became ordinary shareholders of Vistaprint N.V. and Vistaprint
Limited became a wholly owned subsidiary of Vistaprint N.V. The par value of the Company’s
common shares increased from $0.001 per share to e0.01 per share (or $0.014 based on an
exchange rate in effect on August 31, 2009). In connection with consummation of the scheme of
arrangement, Vistaprint N.V. assumed Vistaprint Limited’s existing obligations in connection with
awards granted under Vistaprint Limited’s incentive plans and other similar employee awards.
Additionally, 120,000,000 preferred shares with a par value of e0.01 per share were authorized, of
which no preferred shares are issued or outstanding.
An independent foundation, Stichting Continuïteit Vistaprint (the “Foundation”), was established to
safeguard the interests of the Company and its stakeholders and to assist in maintaining the Company’s
continuity and independence. On November 16, 2009, Vistaprint N.V. entered into a Call Option
Agreement with the Foundation pursuant to which the Foundation may acquire a number of Vistaprint
N.V.’s preferred shares up to a maximum of the total number of Vistaprint N.V.’s ordinary shares then
outstanding at an exercise price of e0.01 per share. The call option held by the Foundation is designed to
provide a protective measure against unsolicited take-over bids for the Company or other hostile threats
through the issuance of preferred shares to the Foundation that would give the Foundation voting and
dispositive power over up to 50% of Vistaprint N.V.’s outstanding securities. The Company has determined
it is the primary beneficiary of the Foundation and therefore has included the Foundation in its
consolidated financial statements.
The change of domicile described above (the “Change of Domicile”) was accounted for as a
merger between entities under common control and as a result all historical share information has
been restated to reflect its impact. The historical financial statements of Vistaprint Limited for periods
prior to this transaction are considered to be the historical financial statements of Vistaprint N.V. Both
the Change of Domicile and the consolidation of the Foundation have not had and are not expected to
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