Atari 2011 Annual Report Download - page 106

ANNUAL FINANCIAL REPORT – REGISTRATION DOCUMENT
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settled in new Atari shares would result in the issue by the Company of 407,603 new Atari shares.
The Cryptic Studios stock option holders have undertaken to take up the above-described rights issue which will be
submitted for approval at an Extraordinary Shareholders’ Meeting to be held by the March 1, 2011 debt settlement date.
This will result in the issue of a maximum of 407,603 new shares of the Company and will be reserved for the
beneficiaries of the debt obligation. The issue will be paid up by offsetting the debt corresponding to the earn-out
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 amount corresponding
to the average of the prices quoted for Atari shares over the ten trading days preceding the March 1, 2011 earn-out
payment date, for an amount representing no more than 700% of the €5.90 reference price set for Atari shares at the
date Cryptic Studios was acquired.
In addition, as consideration for the transfer of a minority shareholder’s interest in Cryptic Studios, the Company has
granted a debt obligation to that shareholder, who was unable to enter into the Stock Purchase and Transfer Agreement
at the time of the acquisition. This obligation gives the minority shareholder concerned the same rights as those granted
to the convertible bond holders in relation to the earn-out payment for the acquisition of Cryptic Studios, as he would
have received convertible bonds as consideration for the transfer of his Cryptic Studios shares if he had transferred them
at the time of the company’s acquisition. The payment of the debt would entitle the shareholder to receive a maximum of
1,234 new shares in the Company, issued under a right offering reserved for him and paid up by capitalizing the debt due
to him in connection with the earn-out payment for the acquisition of Cryptic Studios.
In Fiscal Year 2010/2011, Champions Online online revenues did not meet the earn out targets. As of March 1
st
, 2011,
as part of the payment of the earn out based on StarTrek Online online revenues, the aggregate number of deferred
consideration shares issuable upon the debt obligation amounted to 118,748 shares.
12.10. 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 bonus represents a maximum amount
of USD 20 million and would be payable as follows:
• either in cash, with half the amount payable by the end of November 2010 and the remaining half payable
by mid-May 2011; or
• by issuing, at the option of the Company, new common stock of the Company through a rights issue
reserved for the beneficiaries of the bonus.
In regards with Champions Online and StarTrek Online online revenues, no bonus payment is due. .
13. OTHER FINANCIAL LIABILITIES
(€ in thousand) 31/03/2011 31/03/2010
Accrued interest on bond debt 60 60
Bank overdrafts -
Accrued interest on ORANE bonds - 15
Accrued interest on bank borrowings and overdrafts - -
Liabilities to Group subsidiaries 8 864 9 308
Other 51 88
Total other financial debts 8 915 9 396
Total other debt and accrued interest 8 974 9 471
o/w due in more than 1 year 8 864 9 308
o/w due in less than 1 year