Atari 2010 Annual Report Download - page 29

ANNUAL FINANCIAL REPORT – REGISTRATION DOCUMENT
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Atari’s corporate officers are its directors, among whom only the Chief Executive Officer and the Chief Operating Officer
hold executive positions.
Compensation of the Chairman of the Board of Directors
- Frank E. Dangeard
On March 15 and March 22, 2009, the Board of Directors established the Chairman's annual fixed compensation at
€100,000 (excluding directors’ fees).
In addition, in his capacity as Chairman of the Finance and Resources Committee and the Strategy Committee, for which
it is expected that he shall devote up to 10 days per month he will receive a monthly cash compensation of €30,000.
Lastly, Frank E. Dangeard is entitled to reimbursement of any reasonable expense incurred through the performance of
his duties.
Indemnity in the event of termination
In the event of termination before the end of his term as non-executive Chairman for any reason other than gross
negligence, Frank E. Dangeard will be entitled to receive severance compensation corresponding to his annual fixed
compensation of €100,000. Payment of this compensation will be contingent on the achievement of qualitative and
quantitative objectives set by the Board of Directors.
These performance objectives comprise the quality of governance, strategic orientation, the preparation of the Board's
work determined by the Board of Directors during the Chairman's term of office, as well as the change in the Company's
relative position in its business sector in terms of market share, financial performance and market capitalization. Equal
weight will be given to all these considerations.
Compensation of the Chief Executive Officer (CEO) and Chief Operating Officer (COO)
- Jeff Lapin (CEO from December 10, 2009)
Jeff Lapin was appointed Chief Executive Officer (CEO) on December 10, 2009, replacing David Gardner, who remained
a director until April 16
th
2010, and has been given a special assignment to help the Board with the transition, at the
request of the Board of directors and its Chairman.
Fixed and variable compensation
The CEO compensation was set by the Board of directors on December 10, 2009. It includes a fixed portion and a
variable portion. The variable compensation depends on the complete or partial fulfillment of performance criteria set by
the Board of directors for the fiscal year, based on proposals by the Nomination and Compensation Committee.
On a full year basis, Jeff Lapin’s fixed compensation is €400,000, and his variable compensation may reach €200,000 if
all performance criteria are fulfilled. In addition, Mr. Lapin will be entitled to receive a sum equal to a portion of withheld
payroll taxes, so that his net compensation remains the same as when he was employed by Atari, Inc. For the fiscal year
2009/2010, Jeff Lapin received a net fixed compensation of €378,100 and will receive a gross variable compensation of
€140,000 (to be paid in fiscal year 2010/2011), for both his Chief Operating Officer (COO) functions (from May 25, 2009
until December 10, 2009) and his CEO functions (starting December 10, 2009).
Each year, the Board of directors sets performance criteria applicable to the variable portion of senior executives’
compensation. For fiscal 2009-2010, the quantitative criteria listed below weigh 60 percent and qualitative criteria weigh
40 percent. Quantitative criteria are current operating income and free cash flow, in equal parts (with results for the year
being measured against the budget submitted by management to the board of directors). Qualitative criteria, which vary
in weight depending on the positions held by the executives concerned, are (i) the maximizing of asset disposals and
licensing opportunities, (ii) compliance with the publishing roadmap, on-schedule completion of projects, compliance with
budgets and the quality of new releases, (iii) the release of Champions Online, Star Trek Online and other games on
schedule, on budget and in accordance with quality standards, (iv) the planning and implementation of cost-saving
measures (for Cryptic, Eden, administrative and sales expenses, etc.) and appropriate cost controls, and (v) the
implementation of strategic options approved by the Board of directors. As of June 30, 2010, the Board did not settled
final variable compensation performance criteria for fiscal 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 Code, the Board of directors has decided that the CEO had to keep at least 15
percent of the shares acquired through the exercise of options for his entire term of office.
Performance criteria applicable to the stock options are set by the Board of directors, upon the recommendation of the