Atari 2010 Annual Report Download - page 86

ANNUAL FINANCIAL REPORT – REGISTRATION DOCUMENT
86
BANC OF AMERICA (BOA) / BLUEBAY CREDIT FACILITY
The Company and its main European subsidiaries entered into a master agreement with Banc of America on
April 21, 2006 (based on an agreement on terms signed on March 28, 2006) aimed at refinancing all the short- and
medium-term debt of the Company and its subsidiaries (excluding Atari Inc.).
The seventh and eight amendments to the agreement were signed in the fourth quarter of 2008-2009 (February 27, 2009
and March 31, 2009, respectively) for the purposes of (i) extending the facility’s expiration date to December 31, 2009
and (ii) increasing the total amount of the facility from €46.9 million to €61.8 million.
The credit facility includes specific covenants based on the Group’s compliance with financial ratios pertaining to revenue
aggregates, EBIT and operating cash flow. As of March 31, 2008, Banc of America waived its rights in the event of a
failure to meet the financial ratios and new covenants were scheduled to be negotiated for subsequent quarters. As of
end-March 2009, these negotiations had not been concluded, and accordingly, the Group had no covenants to observe
for this 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 €5.3 million had been drawn down under the credit facility in the form of cash or standby
loans. Drawdowns in cash carry interest at the 3-month Euribor +850 basis points and standby loans carry interest at
3%.
Drawdowns under the Banc of America / BlueBay credit facility can be analyzed as follows at March 31, 2010 and 2009:
(€ million) March 31, 2010 March 31, 2009
Short- and medium-term credit facility (historical) - -
New credit facility (cash) 5.3 46.9
Sub-total 5.3 46.9
New credit facility (standby) - -
Total amount drawn down under the BOA / BlueBay facility 5.3 46.9
BlueBay credit facility (Atari Inc)
On October 25, 2007, BlueBay High Yield Investments (Luxembourg) SARL granted a USD 10 million credit facility to
Atari Inc until December 31, 2009 to replace the Guggenheim facility secured on November 3, 2006.
Loans under the new facility carry interest at LIBOR +7% and require specific financial ratios to be met.
On December 4, 2007, the amount available under the facility was raised to USD 14 million. At March 31, 2008, the
facility was fully drawn down. As Atari Inc. was in breach of certain contractually defined covenants this credit facility was
presented under short-term debt. However, in view of IESA‟s plan to buy out the minority interests in Atari Inc, BlueBay
agreed to waive certain financial ratio requirements. BlueBay also approved a USD 20 million financing of Atari Inc. by
IESA.
As part of the ORANE-BSA issue carried out in January 2009 the Company undertook to pay off the USD 14.0 million
loan granted by BlueBay to Atari Inc. under this facility. This loan was therefore fully repaid at March 31, 2009.
ORANE bonds issued in 2008 ("ORANE 2008 bonds")
On January 4, 2008, the Company issued 1,500,000 bonds redeemable for new or existing shares (ORANE bonds),
maturing on April 1, 2014. The bonds have a nominal value of €100 each (representing an aggregate amount of €150
million) and are redeemable for 8.91 new or existing shares, taking into account the reverse stock split. The gross and
net proceeds of the issue came to €150 million and €144.1 million respectively.
The bonds bear interest at an annual rate of 0.5% – representing €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
the Company on January 4, 2008 (ISIN code FR0010560615) and (ii) the stock warrants issued by the Company on
December 22, 2006 and January 24, 2007. A total of 1,479,871 ORANE 2008 bonds – representing 99.6% of the bonds
still outstanding at January 27, 2009 – were tendered to the offer.