NEW YORK, Nov. 3 /PRNewswire-FirstCall/ -- Atari, Inc. a leader in interactive entertainment, today announced that its Board of Directors has approved a plan to seek stockholder approval for a one-for-ten reverse stock split. Currently, the price of Atari common stock is approximately $0.50 per share. The proposed stock split would reduce the outstanding shares to one-tenth their current number, and by doing so, should result in a per share market price well above the $1.00 per share Nasdaq minimum bid price requirement. The reverse stock split will require amendments to Atari's certificate of incorporation, which will require stockholder approval. Atari's Board of Directors will be asking stockholders to approve an amendment that will (a) effect the one-for-ten reverse split, (b) reduce the shares Atari is authorized to issue without further stockholder approval to one-tenth the current number, and (c) change Atari's corporate name to ensure that stockholders will be able to distinguish certificates representing post-reverse split shares from the certificates they currently hold, which will not reflect the reduction in shares resulting from the reverse stock split.
Infogrames Entertainment, S.A., holder of 51% of Atari's shares, has said it will attend the meeting at which stockholders vote on the amendments to Atari's certificate of incorporation, and that it will vote in favor of the amendments. The reverse stock split would affect all of Atari's common stock in the same way, and therefore would not affect the percentage ownership of any stockholders. Outstanding stock options and warrants would be adjusted to reflect the effects of the reverse stock split.
Bruno Bonnell, Chairman of the Board of Directors of Atari, said "The final decision for Atari to undergo a reverse stock split was made in connection with an appeal from a Nasdaq staff determination that Atari's common stock should be suspended because it was not in compliance with Nasdaq's minimum bid price requirement. While Atari has not been assured that the reverse stock split will ensure reversal of that staff determination, even if the determination were not reversed and trading was moved to the Nasdaq Capital Market, continued eligibility for trading in that market would require that the market price of Atari's common stock be above $1.00 per share."
Additional Information and Where to Find It
Atari has filed with the SEC a preliminary proxy statement regarding the reverse stock split proposal. It expects shortly to mail definitive proxy statements to its stockholders. Atari stockholders are urged to read the definitive proxy statement carefully when it becomes available, because it will contain important information about Atari and the reverse stock split proposal. Investors and stockholders may obtain a free copy of the definitive proxy statement (when it is available) at the SEC's web site at http://www.sec.gov/ . A free copy of the definitive proxy statement will also be available from Atari.
About Atari, Inc.
New York-based Atari, Inc. develops interactive games for all platforms and is one of the largest third-party publishers of interactive entertainment software in the U.S. The Company's 1,000+ titles include hard- core, genre-defining franchises such as The Matrix(TM) (Enter The Matrix and The Matrix: Path of Neo) and Test Drive(R); and mass-market and children's franchises such as Nickelodeon's Dora the Explorer(TM), and Dragon Ball Z(R). Atari, Inc. is a majority-owned subsidiary of France-based Infogrames Entertainment SA (Euronext -- ISIN: FR-0000052573), the largest interactive games publisher in Europe. For more information, visit http://www.atari.com/.
Safe Harbor Statement
With the exception of the historical information contained in this release, the matters described herein contain certain "forward-looking statements" that are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this release are not promises or guarantees and are subject to risks and uncertainties that could cause our actual results to differ materially from those anticipated. These statements are based on management's current expectations and assumptions and are naturally subject to uncertainty and changes in circumstances. We caution you not to place undue reliance upon any such forward-looking statements. Actual results may vary materially from those expressed or implied by the statements herein. Some of the factors which could cause our results to differ materially include the following: the loss of key customers, such as Wal-Mart, Best Buy, Target, GameStop and EB Games; delays in product development and related product release schedules; inability to secure capital; adapting to the rapidly changing industry technology, including new console technology; maintaining relationships with leading independent video game software developers; maintaining or acquiring licenses to intellectual property; fluctuations in the Company's quarterly net revenues and results of operations based on the seasonality of our industry; the termination or modification of our agreements with hardware manufacturers; and other factors described in our SEC filings.
The Company undertakes no duty to update any forward-looking statements to conform the statement to actual results or changes in the Company's expectations.
