Atari 2010 Annual Report Download

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ANNUAL FINANCIAL
REPORT/REGISTRATION
DOCUMENT
Fiscal year 2009-2010

Table of contents

  • Page 1
    ANNUAL FINANCIAL REPORT/REGISTRATION DOCUMENT Fiscal year 2009-2010

  • Page 2
    ... 08-0577. CONSOLIDATED FINANCIAL STATEMENTS FISCAL YEAR ENDED MARCH 31, 2010 Note to the reader: The English language version of this report is a free translation from the original, which was prepared in French and is available on the company's corporate website (http://corporate.atari.com). In the...

  • Page 3
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT CONTENTS ANNUAL FINANCIAL REPORT 2 REGISTRATION DOCUMENT 2 GENERAL INFORMATION 4 CORPORATE PROFILE 4 STRATEGY 5 HISTORY 7 THE MARKET FOR INTERACTIVE ENTERTAINMENT SOFTWARE 8 BUSINESS 10 FRANCHISES AND LICENSES 10 MATERIAL CONTRACTS 11 ...

  • Page 4
    ... Bandai Partners business, which has been sold on July 7, 2009, is reported on the line "Profit (loss) from discontinued operations" as from April 1, 2007. Group revenue and current operating income for fiscal year 2007-2008, 2008-2009 and 2009-2010 exclude the Namco Bandai Partners business. Number...

  • Page 5
    ...games and successfully managing the transition from box to online; 2- Supporting this publishing strategy with an efficient online platform and shared-service group leveraging Atari's brand and customer services; 3- Continuing to optimize operations; 4- Setting up partnerships to support the Company...

  • Page 6
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT • • Revenues from console online games (Xbox and Play Station), potentially generating online revenues through direct sales, micro-transactions, sales of add-ons or extensions, etc.; Revenues from mobile games based on Atari's historical IPs sold...

  • Page 7
    ...the signing of a strategic partnership between the Company's subsidiary Atari Europe and Namco Bandai Games Europe, under which Namco Bandai Games Europe acquires a 34% stake in the new entity, Namco Bandai Partners (the transaction is completed in February 2009). Namco Bandai Partners is created in...

  • Page 8
    ... 2009. In early July 2009, Atari completes the sale to Namco Bandai Games Europe of Atari Europe's remaining 66% stake in Namco Bandai Partners for a cash consideration of approximately â,¬36.3 million. 2010 In January 2010, the Group completed a successful rights issuance, raising â,¬43 million...

  • Page 9
    ... Sony add power and online features to their hardware to create an ever more realistic and advanced gaming experience (as well as entertainment video capabilities with the new HD laser disc), Nintendo has experimented with new playing techniques by replacing the classic gamepad with a remote control...

  • Page 10
    ... Namco Bandai Partners (see the paragraph "Distribution agreement with Namco Bandai Partners, page 12). FRANCHISES AND LICENSES The Group's strategy consists in publishing and distributing products for all mass-market interactive systems (game consoles, PCs, online), based on its own original...

  • Page 11
    ... generated by the Champions Online and Star Trek Online video games exceeds the targets set by Cryptic. The bonus is payable in cash or in newly-issued Atari shares at Atari's option. In the event of a share-based payment the number of shares will be contingent on Atari's share price. The Stock...

  • Page 12
    ... the PAL regions) the distribution operations were sold to Namco Bandai Games Europe, as part of the sale of Namco Bandai Partners. Consequently, this business is no longer significant for the Group in Europe or in Asia (PAL regions). In North America, Atari Inc. entered into an exclusive agreement...

  • Page 13
    ... March 31, 2010: included continued investments by the Group in the development of major titles released during the year or scheduled for release this year including Test Drive Unlimited 2, Champions Online, Star Trek Online, Ghostbusters and NeverWinter Nights. The Company is also working on the...

  • Page 14
    ...elsewhere in Europe, Atari works closely with the anti-piracy unit set up by institutions such as SELL (the French association of entertainment software manufacturers), the Entertainment Leisure Software Publishing Association (ELSPA) and customs authorities. The Group works with customs authorities...

  • Page 15
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT INSURANCE The Group is insured worldwide against property damage, business interruption and civil and professional liability, and insures its intellectual properties. It also purchases liability insurance for its corporate officers and directors. In ...

  • Page 16
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT GROUP PREMISES The Group has been operating in France out of its Vaise rented premises in Lyon since 2001 and is committed to staying there for nine years, i.e. until June 30, 2010. Group subsidiaries also lease premises. The lessors of all rented ...

  • Page 17
    ... FINANCIAL STAT EMENTS Year ended March 31, 2010 BOARD OF DIRECTORS' REPORT ON THE GROUP'S MANAGEMENT 1. ECONOMIC ENVIRONMENT AND HIGHLIGHTS OF THE YEAR 1.1. ECONOMIC ENVIRONMENT Atari ("the Company" or "the Group") is one of the world's famous developers and publishers of interactive game software...

  • Page 18
    ...2009, the Board of directors decided to change the Company's name from Infogrames Entertainment to Atari, in order to enable the Company to make more effective use of the Atari brand, with its worldwide recognition and consumer loyalty, factors that play a key role in the Group's online, product and...

  • Page 19
    ... arbitration process between Namco Bandai Partners and Atari In May 2010, Atari settled its arbitration process with Namco Bandai Partners. See paragraph above: "1. Highlights of the year - Completion of the sale of Atari's 66-percent stake in Namco Bandai Partners to Namco Bandai Games Europe". 19

  • Page 20
    ... fiscal year, a decrease of 15.2%. The decrease was primarily due to lower publishing revenue in FY 2009/2010, partially offset by increased online and licensing revenue. For FY2009/2010, Atari focused on selling fewer but more profitable games. Sales were driven by Atari's major releases over...

  • Page 21
    ...resulted in the recognition of a goodwill impairment for the Retail Development/Publishing cash-generating unit of â,¬40.3 million for the year ended March 31, 2009. Impairment tests performed on March 31, 2010 did not result in any write-downs. Operating income (loss) There was an operating loss at...

  • Page 22
    ... (loss) from discontinued operations is recorded as a result of the Company's decision to sell its European and Asian distribution businesses to Namco Bandai Games Europe ("NBGE") in the previous fiscal year. The current period income reflects a capital gain of â,¬15.0 million, partially offset...

  • Page 23
    ...the publishing and physical distribution of interactive entertainment. Revenue: Retail revenue, comprised primarily of sales to retail stores and licensing revenue, decreased by â,¬31.1 million to â,¬102.2 million in fiscal year 2009/2010, due primarily to a lower number of titles and price pressure...

  • Page 24
    ... connection with the sale of the 66% interest in Namco Bandai Partners. A portion of the cash from the sale was used to pay down the credit facility. • Cash flow of â,¬8 million (before debt service and taxes) reflecting continuing cost cutting measures and the new publishing strategy implemented...

  • Page 25
    ... the European operation, partially offset by a reduction of accounts receivable from the collection of prior year end publishing receivables. Other non-current liabilities (including non-current provisions) were to â,¬18.5 million on March 31, 2010 as compared to â,¬22.9 million on March 31, 2009...

  • Page 26
    ... representative of that of the Group as a whole. The Company used to publish management report on the parent company statutory financial statements. However, due to the new organization of the Group and the way management is analyzing the business, providing such information is not relevant anymore...

  • Page 27
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT 4. BUSINESS AND FINANCIAL RESULTS OF SUBSIDIARIES The Company used to provide business and financial results by subsidiaries. However, due to the new organization of the Group and the way management is analyzing the business, as well as the ...

  • Page 28
    ... year ended comprised no non tax-deductible expenses. 7. CORPORAT E OFFICERS Information on the list of corporate officers and the composition of senior management are provided in the section on "Corporate Governance" in this Registration Document. COMPENSATION OF CORPORATE OFFICERS (Information...

  • Page 29
    ... year 2010/2011. Grant of stock options Mr. Lapin was granted stock options when he joined the Company as an employee of Atari, Inc. and became the Group's COO. These options are subject to annual performance criteria set by the Board of directors. As required by article L. 225-185 of the Commercial...

  • Page 30
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT Nomination and Compensation Committee. Because of the turnaround of the Company, the change in its business model, the size of the Company and the current economic environment, 3-year criteria as well as peer group criteria are not relevant. As a ...

  • Page 31
    ... a larger share of directors' fees than other directors, as permitted by Article R.225-33 of the French Commercial Code. For fiscal year 2009-2010, no directors' fees were paid between April 1, 2008 and March 31, 2009 (compared with â,¬255,800 paid in fiscal year 2009-2010 for fiscal year 2008-2009...

  • Page 32
    ...-102-1 of the French Commercial Code) For the fiscal year ended March 31, 2010, the Group's corporate officers and directors received aggregate compensation from all Group entities of â,¬5.7 million (gross, including valuation of stock options), i.e. fixed compensation for â,¬1.4 million, variable...

  • Page 33
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT Table 1 of AMF recommendations Compensation, stock options and free shares granted to each executive corporate officer Fiscal year (â,¬ thousands) 2008-2009 David Gardner, Chief Executive Officer until December 10, 2009 Compensation due for the year (...

  • Page 34
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT STOCK OPTION PLANS Under each of the plans, the exercise price set by the Board of directors on the date options are granted carries no discount to the price of shares. It corresponds to the shares' average price over the twenty trading days ...

  • Page 35
    ... CORPORATE OFFICERS DURING FISCAL YEAR 2009-2010 AND OPTIONS EXERCISED Table 4 of AMF recommendations Stock options granted during the fiscal year to each executive corporate officer by the issuer or by any other group company Name of the executive N° and date of the plan Value of options Number...

  • Page 36
    ... by the Number of Shareholders' Meeting No. and date of shares during the fiscal year to the plan granted during each corporate officer by the fiscal year the issuer or any other Group company Fiscal year 2008/2009 None Fiscal year 2009/2010 None Value of options according to the method used in the...

  • Page 37
    ... ten Company employees, other than corporate officers, who subscribed the largest number of options No shares were acquired by Company employees in fiscal year 2009/2010 through the exercise of stock options granted by the Company or its subsidiaries. Paris, July 22, 2010 The Board of Directors 37

  • Page 38
    ... entity has a free share plan. Performance share plans Date of Shareholders' Meeting authorizing plan Date of the Board of Directors meeting/Grant date Vesting date Total number of shares originally granted Of which to members of the Board and senior management Trading price of shares (in â,¬) % of...

  • Page 39
    ...of the French Commercial Code. No stock options were granted to corporate officers or directors by any of its subsidiaries in fiscal year 2009/2010. Paris, July 22, 2010 The Board of Directors 8. RISKS TO WHICH T HE BUSINESS IS EXPOSED FINANCIAL RISKS For further information on financial risks, see...

  • Page 40
    ... game, review and control of all litigations, etc. Strict cost control on day-to-day operations. • • Based on the above-described measures and assumptions, as well as the forecast for fiscal year 2010-2011 as approved by the Board of Directors, management believes that the Group's financial...

  • Page 41
    ... on its business. The Group relies for much of its business on licenses granted by hardware (console) manufacturers. These agreements are for average terms of three years and enable the Group to develop products for use on a proprietary medium (Game Boy Advance, Nintendo DS, PS2, PSP, Xbox 360, PS3...

  • Page 42
    ... generation of consoles such as the current Microsoft Xbox 360 and Sony Playstation 3 (PS3), which have increased power and online gaming features, the development of XBLA and PSN, or the Nintendo Wii, which has successfully introduced a new way of playing. Increased production costs are due in part...

  • Page 43
    ...Atari-owned franchises, original franchises and owned publishing rights. While the Company places particular emphasis on the quality of its games, it is nevertheless exposed to a risk of dependency from the fact that it releases a small number of games, which account for a large portion of its sales...

  • Page 44
    ...major accounts". A limited number of customers account for the bulk of sales by most of the Group's distribution subsidiaries, meaning that they are strongly dependent on those customers. The sale, effective July 7, 2009, of all European and Asian distribution operations to Namco Bandai Games Europe...

  • Page 45
    ... of the litigation. Hasbro, Inc. v. Infogrames Entertainment, SA Hasbro, Atari's licensor for exclusive, world-wide rights to create, design, develop, manufacture, have manufactured, market and sell digital games based upon the Dungeons & Dragons worlds, sued Atari in federal District Court in Rhode...

  • Page 46
    ... specific expertise. The Group is currently adapting its corporate structure as it continues to revamp its publishing strategy. It is looking for personnel with key expertise, notably in the online area and in digital operations. Like most companies in the video game sector, the Group is exposed to...

  • Page 47
    ... years Total Floating rate Fixed rate Floating rate Floating rate 7.0 7.0 Credit risk The Group has a worldwide customer base and manages its commercial risks so as not to be exposed to excessive concentration of credit risks. EXPOSURE TO INDUSTRIAL AND ENVIRONMENTAL RISKS The Group's business...

  • Page 48
    ... of May 15, 2001 on new economic regulations. This report covers the entities belonging to the Atari Unité économique et sociale (UES), meaning the holding entity, Atari SA and Atari Europe SAS, exclusive of Eden Games SAS and of corporate officers. As of March 31, 2010, the above French entities...

  • Page 49
    ...May 2010, Mrs. Gina Germano left Atari's Board of Directors, the Board did not co-opted any new members at the date of the present document. Reduction of the credit line amount to be drawn As per Addendum 10 to the Credit Facility Agreement signed in April 2010 between BlueBay and the Company, a New...

  • Page 50
    ... of the year - Completion of the sale of Atari's 66-percent stake in Namco Bandai Partners to Namco Bandai Games Europe". 12. COMPANY PROSPECTS The Group expects to report considerable improvement in current operating income (loss) in each of the semesters in fiscal year 2010/2011 as compared...

  • Page 51
    ... 12/10/09 Free warrants issue resulted in the subscription of 7,610,895 new shares and 156,428,2010 ORANE (conversion ratio: 26,39 new or existing shares / ORANE 2010) Not used Delegation of authority granted to the Jan. 19, 2009 board of directors to issue securities with rights to shares, without...

  • Page 52
    ... of persons Delegation of authority to the board of directors to issue shares and securities with rights to shares of the Company for offering to members of an employee savings plan. January 19, 2009 Resolution 6 (26 months) Nov. 24, 2010 (18 months) Up to 10% of the shares In connection with...

  • Page 53
    ... by the Board of May 25, 2009) Up to 10% of the shares outstanding Not used 2.1 1- The shares have a nominal value of 1 euro. As of March 31, 2010, the Company's capital stock amounted to 21,113,623 euros, divided into 21,113,623 shares. 2- The number of shares issued pursuant to resolutions...

  • Page 54
    ... CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ...59 NOTE 1 - SIGNIFICANT EVENTS OF THE YEAR ...60 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ...63 NOTE 3 - GOODWILL...73 NOTE 4 - INTANGIBLE ASSETS ...75 NOTE 5 - PROPERTY, PLANT AND EQUIPMENT ...77 NOTE 6 - NON-CURRENT FINANCIAL ASSETS ...79...

  • Page 55
    ... million). (*) Cost of stock options, free shares and incentive bonuses paid in shares. During fiscal year ended March 31, 2010, the Company recorded a â,¬ 1.6 million income (see note 19 Share-based payments) The following notes form an integral part of the consolidated financial statements. 55

  • Page 56
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT GLOBAL CONSOLIDATED INCOME STAT EMENT (in millions d'euros) GROUP CONSOLIDATED NET RESULT Elements directly incurred in net equity : Translation adjustments Total result directly recognised in net equity GLOBAL RESULT Of which : Group Minority ...

  • Page 57
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT CONSOLIDAT ED BAL ANCE SHEET (â,¬ million) Notes March 31, 2010 March 31, 2009 Goodwill Intangible ass ets Property, plant and equipm ent Non-current financial ass ets Deferred tax as sets Non-current assets Inventories Trade receivables Current ...

  • Page 58
    ... and equipment Non-current financial assets Impact of changes in scope of consolidation Net cash provided by investing activities - Discontinued operations Net cash used in investing activities - Continuing operations Net funds raised from: Share issues Issue of ORANE bonds New borrowings Net funds...

  • Page 59
    ... million euros. (5) In February 2009, the Group agreed to sell 34 percent of the shares it held in Namco Bandai Partners to Namco Bandai Games Europe. In March 2009, pursuant to the provisions of the strategic partnership agreement with Namco Bandai Games Europe, Atari exercised its put option on 66...

  • Page 60
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT GENERAL INFORM AT ION ABOUT THE GROUP Atari SA (hereinafter referred to as "Atari" or the "Company") designs, produces, publishes and distributes interactive entertainment software for a wide range of media systems (game consoles, PCs, etc.). The ...

  • Page 61
    ... participation in the financial transaction (free allocation of warrants) (â,¬12.6 million) was paid up through a set-off against a portion of the principal amount of the debt held by BlueBay Value Recovery (Master) Fund on the Atari Group. As per amendment 10, signed in April 2010, the total amount...

  • Page 62
    ... published March 31, 2009 corrected Corrections TOTAL Assets Capital stock Share premium Consolidated reserves Shareholder's equity Minority interests Total equity Non-current financial liabilities Deferred tax liabilities Other non-current liabilities Non-current liabilities Current liabilities...

  • Page 63
    ... improve working capital. Those measures had their first positive effects in the second half of FY 2009/2010 when the Group published positive net income over that period. These measures included, among other: • Sale of all of the Group's Distribution operations in Europe and Asia to Namco Bandai...

  • Page 64
    ... to the way management monitor the Company. Considering the Group restructuring, its new focus on online business and the recent launch of the first MMO games developed by Cryptic, the performance of the Group is now presented by business activities (Online, Retail and Corporate & Other) and no...

  • Page 65
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT 2.2. CONSOLIDATION METHODS Full consolidation All companies over which the Group exercises control, i.e. over which it has the power to govern the financial and operating policies so as to obtain benefits from their activities, are fully consolidated....

  • Page 66
    ... on the value of assets and liabilities, equity, profit and contingent assets and liabilities, as reported at the balance sheet date. The consolidated financial statements have therefore been prepared taking into account the current financial and economic crisis and on the basis of market inputs at...

  • Page 67
    ... from the date the games are released, on a quarterly declining-balance basis that reflects the sales prospects of the products concerned. This use of the declining-balance method means that 90% of a game's value is written off in the year following its release. The Group verifies the recoverable...

  • Page 68
    ... accordance with the accounting principles described in Note 2.2. Treasury shares held by the parent company or fully consolidated subsidiaries are deducted from equity on the basis of their purchase price or initial balance sheet value. Gains or losses on sales of treasury shares are eliminated in...

  • Page 69
    ... as payroll expenses. The fair value of stock options is calculated using the Black & Scholes model, which takes into account the exercise price and period of the options, market conditions on the grant date (risk-free interest rate, share price, volatility, expected dividends) and assumptions...

  • Page 70
    ... financial instruments with a debt component and an equity component. The two components must be measured on the issue date and recognized separately in the balance sheet. The debt component is included in debt based on the present value of future contractual repayments, discounted using the market...

  • Page 71
    ... the release of online games, which represent new and significant operations for Atari. The information below complements note 2 (Accounting rules and methods) to the 2009 annual financial report. In accordance with IAS 18, Revenue, net revenue is recognized after deducting: • certain sales...

  • Page 72
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT 2.26. CURRENT OPERAT ING INCOME AND OPERATING INCOME Current operating income corresponds to gross margin less current operating expenses. Current operating expenses include research and development, marketing and selling and General and ...

  • Page 73
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT 2.29. EARNINGS PER SHARE The Group reports both basic and diluted earnings per share. Basic earnings per share correspond to attributable net income for the period divided by the weighted average number of shares outstanding, net of any treasury ...

  • Page 74
    ... subsequent year and a terminal value. The main assumptions used by management to project future cash flows are a discount rate, growth rates, expected trends in sale prices and operating costs. The table below sets out the discount rates and perpetuity growth rates used at March 31, 2010 and March...

  • Page 75
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT Management set the discount rate on the basis of the weighted average cost of capital, reflecting the market's current assessment of the time value of money and the specific risks to which the various cash-generating units are exposed. In view of the ...

  • Page 76
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT At March 31, 2010, capitalized games-in-progress amounted to â,¬6.4 million (â,¬5.1 million for in-house development expenditure and â,¬1.3 million for costs relating to outsourced development), compared with â,¬22.9 million one year earlier. Other ...

  • Page 77
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT NOTE 5 - PROPERTY, PL ANT AND EQUIPMENT Changes in property, plant and equipment for the year ended March 31, 2010 can be ... of assets held for sale Other changes March 31, 2010 Net value April 01, 2009 Changes in scope of consolidation Acquisitions...

  • Page 78
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT The table below shows changes in property, plant and equipment for the year ended March 31, 2009: Property, plant and equipment (â,¬ million) Other equipment, furniture and fixtures and fittings Total Land Buildings Computer hardware Gross value ...

  • Page 79
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT NOTE 6 - NON-CURRENT FINANCIAL ASSET S Non-current financial assets can be analyzed as follows: (â,¬ million) Deposits Loans Other Total At March 31, 2009 Gross value Impairment Net value at March 31, 2009 2.1 2.1 1.7 (1.6) 0.1 1.3 1.3 5.1 ...

  • Page 80
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT No single customer accounted for more than 22.9% of trade receivables at March 31, 2010, or for more than 23.1% at March 31, 2009. The table below shows changes in provisions for impairment in value: (â,¬ million) At beginning of year Charges ...

  • Page 81
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT The table below shows changes in shares outstanding over the past two fiscal years: (number of shares) Shares outstanding at the beginning of the year Share issues Exercise of stock warrants Conversion of ORANE bonds Conversion of OCEANE convertible ...

  • Page 82
    ...AT ARI SA STOCK OPTION PL AN The Board of Directors has been authorized, until November 27, 2010, to grant options for new or existing common shares of the Company to officers, directors and certain employees of the Group, subject to the ceiling set in Article L.225-182 of the French Commercial Code...

  • Page 83
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT NOTE 12 - PROVISIONS FOR CURRENT AND NON-CURRENT CONTINGENCIES AND LOSSES 12.1. CHANGES IN PROVISIONS Restructuring costs (â,¬ million) Pension liabilities Other Total At March 31, 2009 Current Non-current Provisions at March 31, 2009 Changes ...

  • Page 84
    ...January 2002 to take into account the allocation of free shares on that date. The Company has the option of calling the bonds if, prior to their maturity, the price of Atari common stock rises above a pre-defined level. A prospectus was published in connection with the bond issue and was approved by...

  • Page 85
    ...2004 to take into account the allocation of free stock warrants on that date. The Company has the option of calling the bonds if, prior to their maturity, the price of Atari common stock rises above a pre-defined level. A prospectus was published in connection with the bond issue and was approved by...

  • Page 86
    ... credit facility. The Company, Atari Europe SAS and The BlueBay Value Recovery (Master) Fund Limited met on December 10, 2009 and signed amendment 9 to the loan agreement of April 21, 2006, extending the maturity date of the senior credit facility to December 31, 2010. At March 31, 2010, a total of...

  • Page 87
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT Taking into account the adjustment made to the related exchange parities on February 4, 2009, one ORANE 2008 bond is redeemable for 8.94 new or existing shares. Taking into account the adjustment made to the related exchange parities in January, 2010,...

  • Page 88
    ... Pledge of 66% of the shares in Distribution Partners SAS (waived on July 7, 2009 due to the sale of the remaining 66% interest to Namco Bandai Games Europe SAS). • Pledges of certain trademarks and rights relating to certain video games published by Atari Europe SAS. • Pledges of the intragroup...

  • Page 89
    ... contained in the circular approved by the COB on November 6, 2003 (under notice no. 03-971), which can be downloaded from the Company's website (www.atari.com) or obtained on request. Other debt and borrowings BOA / BlueBay facility 7.0 (incl. interest and charges) The lending bank may accelerate...

  • Page 90
    ... current liabilities ». NOTE 15 - FINANCIAL ASSETS AND LIABILITIES The principal measurement methods used are as follows: - Due to their short maturities the fair value of cash and cash equivalents and trade receivables and payables corresponds to their carrying amount. - The fair value of listed...

  • Page 91
    ...assets Cash and cash equivalents Assets Non-current financial liabilities Other non-current liabilities Current financial liabilities Trade payables Other current liabilities Liabilities 3.5 Fair value Available-forFair value sale financial through profit assets Held-toLoans, maturity receivables...

  • Page 92
    ... in accordance with how the Group's chief operating decision maker reviews financial operations. The Group has focused its future operations on the expansion of its online businesses and will report its segments as online, retail and other. In addition, management believes that geographic and...

  • Page 93
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT 31-Mar-10 Online Revenue Gross Margin Current Operating Income Restructuring and other operating costs Operating Income Costs of debt Other financial income / (expense) Income tax Profit (loss) from continued operations Profit (loss) from discontinued...

  • Page 94
    ... employees in exchange for the options received. The fair value of stock options is calculated using the Black & Scholes option pricing model, which takes into account the exercise price and period of the options, market conditions on the grant date (risk-free interest rate, share price, volatility...

  • Page 95
    ...' exercise price is set close to the trading price of the Company's shares. The options granted have an eight-year life and a vesting period of between zero and three years. The table below summarizes the information concerning the Company's current stock option plans: 2009-2010 Number of options...

  • Page 96
    ... shares granted during the year Shares cancelled Shares vested Number of free shares outstanding at the end of the year 487,417 (249,686) 237,731 2008-2009 639,584 472,685 (624,852) 487,417 The fair value of free shares granted is based on the trading price of the Company's shares at the grant date...

  • Page 97
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT NOTE 20 - NET FINANCIAL INCOME (EXPENSE) Year ended March 31, 2010 (0.9) (3.2) (0.3) (4.4) Year ended March 31, 2009 (8.4) 0.7 (7.7) (2.3) (1.8) (4.1) (11.8) (â,¬ million) Interest on bond debt Interest on bank debt Financial restructuring fees Other...

  • Page 98
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT The table below shows changes in deferred tax liabilities for the two periods under review: Year ended March 31, 2010 3.2 (2.6) 0.1 0.7 Year ended March 31, 2009 (2.2) (0.2) 0.1 5.5 3.2 (â,¬ million) Deferred tax liabilities at April 1 Deferred tax ...

  • Page 99
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT 21.3. T AX PROOF Corporate income tax for the year was calculated by applying the effective tax rate at the balance sheet date to pre-tax profit for the year ended March 31, 2009. In France, deferred taxes were calculated based on a tax rate of 33.33%...

  • Page 100
    ... operations Balance sheet Goodwill Segment fixed assets Other segment assets (1) Unallocated assets (2) Total assets held for sale Segmment liabilities (3) Unallocated liabilities (4) Total liabilities held for sale Year ended March 31, 2010 Corporate & Online Retail Other 26.2 3.0 3.7 - Total 26...

  • Page 101
    ... liabilities held for sale Year ended March 31, 2009 Corporate & Online Retail Other 160.0 (44.3) (90.8) - Total 160.0 (44.3) (90.8) - 3.8 0.6 6.3 74.6 85.3 28.1 39.7 67.8 - 3.8 0.6 6.3 74.6 85.3 28.1 39.7 67.8 (1) Other segment assets include inventories and trade accounts receivable and...

  • Page 102
    ...access to the financial markets. Subsidiaries may do business directly with local banks under the supervision of the parent company, provided that they comply with Group procedures and policies. 24.2. CURRENCY RISKS The Group has not set up a currency hedging strategy for commercial transactions as...

  • Page 103
    ... employee who claimed that he had co-authored one of the Group's best-selling franchises. The plaintiff was seeking damages for moral prejudice and financial loss suffered as a result of the allegedly unlawful distribution by the Group of games based on that universe. The claim was for close to...

  • Page 104
    ...-2010. 25.3 Disputes to which Atari Europe is a party 25.3.1 BVT production fund v. Atari Europe SAS This dispute concerns two German entities, the BVT production funds, which financed the production of certain interactive games, under a series of agreements entered into with various Group companies...

  • Page 105
    ... the subscription price paid by The Bluebay Value Recovery (Master) Fund in the frame of the financial operation has been release by way of partial set off for an amount of 12.6 Millions euros. Pursuant to the addendum number 10 signed on May 2010, the total amount of the usable credit line has been...

  • Page 106
    ... ARI THE ARBITRAT ION PROCESS BETWEEN NAM CO BANDAI In May 2010, Atari settled its arbitration process with Namco Bandai Partners. See paragraph above: "1. Highlights of the year - Completion of the sale of Atari's 66-percent stake in Namco Bandai Partners to Namco Bandai Games Europe". 106

  • Page 107
    ... REPORT - REGISTRATION DOCUMENT NOTE 28 - CONSOLIDAT ED COMPANIES Com pany A + M ultimedia Ltda A tari A sia Ho lding P ty Ltd A tari A sia P acific P ty Ltd A tari A ustralia P ty Ltd A tari B enelux B V A tari Denmark A tari Deutschland GmbH A tari do B rasil Ltda Info grames Entertainment...

  • Page 108
    ... statements are free from material misstatements. An audit includes an examination, on a test basis and using other sampling methods, of evidence supporting the information and amounts reflected in the consolidated financial statements. It also requires assessing the accounting principles used and...

  • Page 109
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT Note 2.23 to the financial statements also sets forth the accounting rules and methods applicable to the recognition of revenue from online games. As part of our assessment of the accounting rules and principles applied by your group, we have verified...

  • Page 110
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT INFORMATION CONCERNING THE PARENT COMPANY ANNUAL FINANCIAL STATEMENTS 1. BALANCE SHEET (â,¬ thousands) Assets Intangible assets Property, plant and equipment Financial assets Total fixed assets Down payments and advances made Trade receivables Other ...

  • Page 111
    ... enables the Company to make the best use of the Atari brand, capitalizing on worldwide strong name recognition and affinity, which are key drivers to implement the Company's online, product and licensing strategies. 1.2. Changes to the senior management team and the Board of Directors In May...

  • Page 112
    ... 2009-2010, in response to the possibility of continued low demand and aimed at advancing the development of its online business. The reorganization reduced administrative expenses and working capital needs, primarily through the sale of the Group's entire interest in Namco Bandai Partners in Europe...

  • Page 113
    ... the Group's operating expenses and capital expenditure for the 12-month period after March 31, 2010. On this basis, the Company has applied the going concern principle in preparing its parent company financial statements. 2.2. Accounting principles The basic method used to measure accounting items...

  • Page 114
    ...activities, on the line "Net change in intra-group balances". Use of estimates The preparation of the annual financial statements in accordance with generally accepted accounting practices requires the use of estimates and assumptions by the Company's management, which affect the value of assets and...

  • Page 115
    ...euros came mainly from new advances to Atari Europe (â,¬30m) and Cryptic (â,¬10m). All receivables from subsidiaries are due in more than one year. As of March 31, 2010, the Company held 2,470 of its own shares, unchanged from March 31, 2009. 4.2. Provisions for impairments of financial fixed assets...

  • Page 116
    ... 3,435 All of the above receivables are due in less than one year. 6. Other receivables (â,¬ thousands) Corporate income tax Sales taxes Receivables from the Group in connection with tax consolidation Other receivables Total 3/31/2010 (1) 590 551 2 1,143 3/31/2009 1,861 1,548 99 3,508 All of the...

  • Page 117
    ... carrying double voting rights. 9.2. Atari stock option plan The Board of Directors has been authorized, until November 27, 2010, to grant options for new or existing common shares of the Company to officers, directors and certain employees of the Group, subject to the ceiling set in Article L.225...

  • Page 118
    ..., the annual and special Shareholders' Meeting on September 30, 2009 authorized free share awards for employees and officers of the Company and of its affiliates, for a 38-month period. In order for rights to free shares to vest, their beneficiaries must be part of the Group on the vesting date and...

  • Page 119
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT The fair value of free shares granted is based on the trading price of the Company's shares at the grant date. The weighted fair value of shares granted in fiscal 2009-2010 was â,¬7.96 per share. The fair value recognized is based on the assumption ...

  • Page 120
    ... at an annual rate of 0.5% - representing â,¬0.50 per bond - payable in arrears on April 1 each year. In December 2008, the Company launched a simplified public exchange offer relating to (i) the ORANE bonds issued by Atari on January 4, 2008 and (ii) the stock warrants issued by Atari on December...

  • Page 121
    ...January 2002 to take into account the allocation of free shares on that date. The Company has the option of calling the bonds if, prior to their maturity, the price of Atari common stock rises above a pre-defined level. A prospectus was published in connection with the bond issue and was approved by...

  • Page 122
    ...2004 to take into account the allocation of free stock warrants on that date. The Company has the option of calling the bonds if, prior to their maturity, the price of Atari common stock rises above a pre-defined level. A prospectus was published in connection with the bond issue and was approved by...

  • Page 123
    ... set-off. The exact number of new shares to be issued will be determined based on the revenue generated for the Champions Online and Star Trek Online video games. The amount of the debt will be indexed to upward or downward changes in the reference price for Atari shares between the completion date...

  • Page 124
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT payment and the issue price will represent the average of the prices quoted for Atari shares over the ten trading days preceding the earn-out payment. If the Company's shareholders vote against the rights issue the debt will be settled in cash for an...

  • Page 125
    ...9 Non-supervisory employees 4 1 Total 14 10 Compensation paid by the Company to the members of its management and governing bodies for the fiscal year ended March 31, 2010 included â,¬2,180 thousand in salary, â,¬255.8 k in directors' fees and â,¬3,264 k in stock options (at their value on March 31...

  • Page 126
    ... to other Group companies. reversals of provisions of 127 million euros, primarily concerning: - provision on the shares of California US Holding (47 million euro) and Game Nation Texas (18 million euro, a subsidiary liquidated during the year), - shareholder advances to Atari Europe (20 million...

  • Page 127
    ... the proceeds from the sale of the Atari Brasil subsidiary to Namco Bandai Partners for â,¬0.1 million and of the Atari Italia subsidiary to Namco Bandai Partners for â,¬0.2 million. expenses on investment transactions mainly comprised the write-offs of the Atari Brasil shares for 1.4 million euros...

  • Page 128
    ... of a first-demand guarantee, the pledge of all of the shares of the following subsidiaries: Cryptic Studios, Inc., Eden Games SAS, Atari Interactive, Inc., Atari, Inc. and Atari Europe SAS, pledges of certain trademarks and rights relating to certain video games published by Atari Europe SAS, 128

  • Page 129
    ... employee who claimed that he had co-authored one of the Group's best-selling franchises. The plaintiff was seeking damages for moral prejudice and financial loss suffered as a result of the allegedly unlawful distribution by the Group of games based on that universe. The claim was for close to...

  • Page 130
    ... 2009-2010. 24.3. Atari Europe SAS litigation 24.3.1. BVT production funds v. Atari Europe SAS This dispute concerns two German entities, BVT productions funds, which, pursuant to a series of agreements entered into with various Group companies, financed the production of certain interactive game...

  • Page 131
    ...4 233 40 69 079 106 599 The Company holds equity interests in subsidiaries and associates providing it with control over them and with significant influence over their management. The Company is the parent entity and head of the Atari Group. It generates most of its revenue by charging for services...

  • Page 132
    ... wound down. As of March 31, 2010, the Company has set aside provisions for all of its shares and debt. (3) As of March 31, 2010, the Company has set aside provisions in the financial statements in an amount of â,¬99.9 million for loans and advances made to Atari Interactive Inc. In the case of...

  • Page 133
    ... Namco Bandai Partners and Atari In May 2010, Atari settled its arbitration process with Namco Bandai Partners. See paragraph above: "1. Highlights of the year - Completion of the sale of Atari's 66-percent stake in Namco Bandai Partners to Namco Bandai Games Europe". 27.4 URSSAF audit The Company...

  • Page 134
    ... financial statements are free from material misstatements. An audit includes an examination, on a test basis and using other sampling methods, of evidence supporting the information and amounts reflected in the annual financial statements. It also requires assessing the accounting principles used...

  • Page 135
    ... of the information contained in the board of directors' management report and the documents provided to the shareholders concerning the company's financial position and annual financial statements. Concerning the information provided in accordance with article L.225-102-1 of the Commercial Code on...

  • Page 136
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT GENERAL INFORM ATION CONCERNING THE COMPANY NAME AND REGISTERED OFFICE (ARTICLES 3 AND 4 OF THE ARTICLES OF INCORPORATION) Atari S.A. (formerly Infogrames Entertainment SA) Registered office: 1, place Verrazzano, 69252 Lyon Cedex 09, France Telephone:...

  • Page 137
    ... the Board of directors and holding the title of Chief Executive Officer. The Board of directors chooses between the two modes of management and the option it selects remains in effect for at least one year. RIGHTS ATTACHED TO SHARES (ARTICLE 11 OF THE ARTICLES OF INCORPORATION) Each share entitles...

  • Page 138
    ...-up stock, regardless of the number of shares they own on the date of the meeting. Notice of the meeting must be given at least fifteen days prior to the date of the meeting on first call, and six days prior to a meeting convened on second call, by means of an announcement published in a newspaper...

  • Page 139
    ... five trading days after any such threshold has been crossed and must state the number of securities held with a present or future right to equity and the number of attached voting rights. Mutual fund management companies must report this information for the aggregate number of the Company's shares...

  • Page 140
    ...Directors, for a period of 38 months, to grant free shares to employees and corporate officers of the Company and its associates, with the total number of new or existing shares to be granted free of consideration not to exceed 10% of the Company's share capital at the date the authorization is used...

  • Page 141
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT Date of Shareholders' Meeting Date of Board of Dircetors' meeting Number of Stock Options granted (1) Of which, to members of the Top Executive Management and Board of directors (2) Plan N° 9 17-Dec-2001 15-Mar-2002 331 357 - Plan N° 10 Plan N° ...

  • Page 142
    ... capital on that date. The principal features of Atari share grant plans currently in effect are described in "Corporate officers" section of "Information on management and the financial statements". 2000-2011 bonds convertible into or exchangeable for new or existing shares (OCEANE 20002011) On...

  • Page 143
    ...bondholders are no longer able to convert their bonds into new Atari shares or exchange them for existing shares, the OCEANE have no dilutive impact since that date. Stock warrants issued in connection with the financial restructuring plan approved at the Extraordinary Shareholders' Meeting held on...

  • Page 144
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT Stock warrants issued in connection with the ORANE-BSA issue in January 2009 and the Simplified Public Exchange Offer in December 2008/January 2009 In January 2009 the Company issued bonds redeemable for new or existing shares with stock warrants ...

  • Page 145
    ... set-off. The exact number of new shares to be issued will be determined based on the revenue generated for the Champions Online and Star Trek Online video games. The amount of the debt will be indexed to upward or downward changes in the reference price for Atari shares between the completion date...

  • Page 146
    ... to him in connection with the earn-out payment for the acquisition of Cryptic Studios. Cryptic bonus As part of the December 2008 acquisition of Cryptic Studios it was agreed that Atari could pay a bonus if revenue targets for the Champions Online and Star Trek Online video games were exceeded. The...

  • Page 147
    ...-out for Champions Online recognized in the Consolidated financial statements for the fiscal year 2009-2010, the total number of shares to be issued could be reduced to 48,977,126. (9) Jeff Lapin and other member of the management. (10) Stock option plan attributed to top 15 key employees. (1) 147

  • Page 148
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT CHANGES IN THE COMPANY'S CAPITAL Cumulative number of shares outstanding Date and type of transaction Payments in cash or in kind Share premium Payments by capitalization Total capital stock (in â,¬) 2006-2007 11/15/2006 Capital reduction 11/27/...

  • Page 149
    ... stock warrants were issued and distributed free of consideration to the Company's shareholders. A total of 70,477,818 warrants were exercised during the exercise period of December 17 to 24, 2004, leading to the issue of 35,238,909 new shares. (2) Issue of 24,037,720 new shares in connection with...

  • Page 150
    ... of information obtained from the registrar. To the best of the Company's knowledge, share ownership and voting rights broke down as follows as of March 31, 2010: Number of Number of shares (%) voting rights (%) Ownership (1) (3) BlueBay 4,044,891 19.2% 4,044,891 19.1% (2) (3) Public 9,222,613 80...

  • Page 151
    ...voting rights. TRADING BY THE COMPANY IN ITS OWN STOCK Treasury share As of March 31, 2010, total treasury shares amounted to 26,070, out of which 23,600 shares in the liquidity contract and 2,470 treasury shares directly owned by the Company. Liquidity agreement The account under the market-making...

  • Page 152
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT TRADING BY CORPORATE OFFICERS IN SHARES AND OTHER SECURITIES (ARTICLE L. 621-18-2 OF THE FRENCH MONETARY AND FINANCIAL CODE) Name and position on the transaction date BlueBay Asset Management Plc Member of the Board of Directors Pascal Cagni Member of...

  • Page 153
    ...Eden Games SAS, Atari Interactive, Inc., Atari Inc., and Atari Europe SAS, (ii) certain trademarks and elements making up games published by Atari Europe SAS, (iii) 66% of the 2 shares of Distribution Partners SAS ( ), and (iv) receivables held by certain subsidiaries on other Group companies. Atari...

  • Page 154
    ... of the Group), without issuing an equivalent pari passu security in favor of the lender or creating an equivalent security interest. OTHER GUARANTEES The Company is guarantor of Atari Europe's obligations to production funds; the aggregate amount guaranteed as of March 31, 2010 is â,¬2.2 million...

  • Page 155
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT INFORM ATION ON TRADING IN THE COMPANY'S SHARES Paying agent: CACEIS Corporate Telephone: +33(0)1.57.78.00.00 Trust, 14, rue Rouget de Lisle, 92130 Issy-les-Moulineaux. COMMON STOCK - ISIN CODE: FR0010478248 The Company's stock is traded on Euronext ...

  • Page 156
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT ORANE 2008 BONDS FR0010560615 (REDEEMABLE FOR NEW OR EXISTING SHARES) - ISIN CODE: Monthly highs and lows High (euros) 2009 April May June July August September October November December 2010....20 Trading volume Volume of shares traded (â,¬ ...

  • Page 157
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT June 62.00 July 67.62 August 71.10 September 115.00 October 140.00 November 131.10 December 118.79 2010... 29, 2006, the maturity date of OCEANE 20032009 bonds not tendered under the public exchange offer by the Company in the period from February 12...

  • Page 158
    ... of four years. The Board of Directors will propose at the next extraordinary shareholders meeting to reduce this term from four years to three years to improve the Company's corporate governance. The role of the non-voting member, as set forth in Article 15 of the Articles of Incorporation, is to...

  • Page 159
    ...52-year old French Current offices and positions • Managing Director of Harcourt • Director of the following companies: - Crédit Agricole CIB - Moser Baer (India) - Sonaecom (Portugal) - Symantec (USA) Member or Chairman of Boards or Strategy committees of a number of non-listed companies and...

  • Page 160
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT Name Date of appointment Term ends (at the close of the shareholders' meeting called to approve the financial statements for the year ending March 31)** Main function in the Company Main position currently held outside the Company Age and ...

  • Page 161
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT Name Date of appointment Term ends (at the close of the shareholders' meeting called to approve the financial statements for the year ending March 31)** Main function in the Company Main position currently held outside the Company Age and ...

  • Page 162
    ...Bushnell April 16, 2010 Director Chairman and founder of Tapcode, Inc. 67-year old USA Current offices or positions: • Wave Systems Corp. • AirPatrol Corp. • Fiddle, Inc. Past offices or positions: • Co-founder of the original Atari Corporation and funder of Chuck E. Cheese's Pizza Time...

  • Page 163
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT Name Date of appointment Term ends (at the close of the shareholders' meeting called to approve the financial statements for the year ending March 31)** 2012 Main function in the Company Main position currently held outside the Company Age and ...

  • Page 164
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT Name Date of appointment Term ends (at the close of the shareholders' meeting called to approve the financial statements for the year ending March 31)** Resigned in April 16, 2010 Main function in the Company Main position currently held outside ...

  • Page 165
    ... expertise in management, finance and accounting, as well as their knowledge of the interactive entertainment sector. As described in the Company's Internal Rules approved by the Board of directors as of April 16, 2010, the Board of directors is vested with the broadest management powers to act...

  • Page 166
    ... Group's financial restructuring - including the issuance of free warrants to purchase shares or ORANE bonds, (iii) the implementation of the Company's strategic plan, including the review of the publishing plan and the corporate name change, (iv) changes in the composition of the Board of Directors...

  • Page 167
    ... OF DIRECTORS AND CORPORATE OFFICERS This information can be found in section 7 of the chapter ST ATUTORY AUDITORS' FEES This information is presented Note 28 to the Annual Statutory Accounts "Statutory auditors' fees". INFORM ATION CONCERNING EMPLOYEE PROFIT SHARINGPROFIT-SHARING PL AN EMPLOYEE...

  • Page 168
    ...the Commercial Code, approved the payment of compensation of 1,333 euros per assignment day to David Gardner, for up to thirty days over a one-year period starting on the date of the Board meeting. No compensation was paid under the agreement in the year ended March 31, 2010. Approval date: Board of...

  • Page 169
    ... Management represented by Jeffrey Lapin. 3. TRANSFER OF SECURITY INTERESTS PREVIOUSLY CREATED BY THE COMPANY AND ATARI EUROPE IN FAVOR OF BANK OF AMERICA (BOA), PRIOR TO THE TRANSFER OF THOSE SECURITY INTERESTS TO THE BLUEBAY VALUE RECOVERY (MASTER) FUND LIMITED The Board of Directors approved...

  • Page 170
    ... of incorporation and bylaws (statuts). No event contemplated in this agreement occurred during the year ended March 31, 2010. Approval date: Board of Directors' meeting of December 10, 2009 Interested party: Jeffrey Lapin. In addition, as required by the Commercial Code, we were informed that...

  • Page 171
    ...-38 et seq. of the Commercial Code. The agreement remained in effect through the fiscal year ended March 31, 2010. An expense of 518,558 euros (compensation and related taxes) was recognized for the year, in connection with this agreement. Approval date: Board of Directors' meeting of March 15, 2009...

  • Page 172
    ... This report refers to the Board of Directors' Management Report included in the Company's Registration Document for the year ended March 31, 2010 with regard to the publication of the information mentioned in Article L. 225-100-3 of the French Commercial Code concerning the Company's share capital...

  • Page 173
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT The Board members have been selected on the basis of their recognized expertise in management, finance and accounting, as well as their knowledge of the interactive entertainment sector. The directors are elected or reelected for four-year terms by ...

  • Page 174
    ... shares or ORANE bonds, (iii) the implementation of the Company's strategic plan, including the review of the publishing plan and the corporate name change, (iv) changes in the composition of the Board of Directors and of the management team, (v), the review of major disposals, (vi) the Group...

  • Page 175
    .... The Board of Directors approves the annual Budget and the multiannual game publishing plan. The Board of Directors also approves any material change in the Budget or in the publishing plan during the year. 3. INTERNAL CONTROL During fiscal year 2009/2010, the Group has been working on relying...

  • Page 176
    ... adopted by the Group's senior management. These procedures are continually updated for changes in accounting policies, financial reporting requirements and consolidation methods. In fiscal 2010/2011, the Group is planning to formally document these procedures. Detailed reports on key oversight of...

  • Page 177
    ... achievement of annual performance targets. In addition, officers, executives and selected critical managers were granted stock options. Compensation paid to members of the Board of directors is described in section 7 of the Board of directors' Management Report included in the Registration Document...

  • Page 178
    ...' MEETINGS The special conditions that apply to the participation of shareholders in Shareholders' Meetings are set forth in Article 19 of the Company's Articles of Incorporation a copy of which may be downloaded from the Company's website. Frank E. Dangeard Chairman of the Board of Directors 178

  • Page 179
    ...regarding the information concerning the company's internal control and risk management procedures pertaining to the preparation and treatment of accounting and financial data, as contained in the chairman of the board of directors' report prepared pursuant to article L.225-37 of the Commercial Code...

  • Page 180
    ... Wii, Xbox LIVE Arcade for Xbox 360, and PC on September 21, 2010, • Backyard Sport: Rookie Rush for Xbox 360, Wii, Nintendo DS and PC shipping October 26, 2010, • A series of retail, XBLA, PSN and PC download releases based upon Atari's classic video game brands in the second half of the year...

  • Page 181
    ...application of new accounting rules and interpretations starting April 1, 2009. The historical financial data for fiscal year ended March 31, 2009 and March 2008 are incorporated by reference. The report for fiscal year ended March 31, 2009 called attention to note 2.1 to the annual and consolidated...

  • Page 182
    ... on the Company's business and financial position can be found on its website at http://corporate.atari.com TENTATIVE TIMETABLE (FOR INFORMATION) Annual Shareholders' Meeting (first notice): September 20, 2010 The shareholders meeting might not be able to discuss at this date as the quorum...

  • Page 183
    ... manager for Europe Atari 9-month revenues for FY 2009/2010 Success of Atari's New Shares and ORANE issue Issue through the free allocation of warrants Atari announces that Jeff Lapin has been appointed as Chief executive officer Release of the half year 2009/2010 financial report Atari publishes...

  • Page 184
    ANNUAL FINANCIAL REPORT - REGISTRATION DOCUMENT Statutory Auditors' report on the issue of securities with preemptive rights; Statutory Auditors' report on the issue of securities without preemptive rights; Statutory Auditors' report on the issue of various securities; Statutory Auditors' report on...

  • Page 185
    ... commitments and material fixed assets 11 12 R&D, patents and licenses Trend information 12.1 Principal trends having affected the Company's business in fiscal 20082009 and until the date of this report 12.2 Other trends and developments likely to affect the business in fiscal 2009-2010 13 Profit...

  • Page 186
    ... Terms of office of the members of the Board of Directors and senior management 16.2 Board members' service contracts 16.3 Information regarding the committees 16.4 Statement of compliance with corporate governance regime 16.5 Chairman's internal control report 16.6 Statutory Auditors' report on the...

  • Page 187
    ... as listed by article L.451-1-2 of the French Monetary and Financial Code (Code monétaire et financier) 2008-2009 statutory financial statements 2008-2009 consolidated financial statements Board of Directors' 2008-2009 management report Statement by the person responsible for the 2008-2009 annual...

  • Page 188
    ATARI 1 place Verrazzano - 69 252 LYON - FRANCE 188